Hey, hey, ho, ho: Here’s why Putin has got to GO!

Vladislav Inozemtsev, editor of the Svobodnaya Mysl journal, writing in the Moscow Times:

Although I signed my name to the Internet petition under the slogan “Putin must go,” I only endorsed the main idea of the petition — that Russia must change the economic and political course set by Prime Minister Vladimir Putin — and not necessarily all of its individual points. For example, I don’t agree that President Dmitry Medvedev is the servile stooge that most of the petitioners make him out to be, and I am convinced that it is possible to modernize Russia without completely destroying the entire ruling regime. Moreover, in opposition to the words contained in the petition’s manifesto, I believe that Putin has done a lot of good things for Russia, and I don’t think that it is necessary to investigate how he became wealthy. Nonetheless, I do agree with the main thesis that Russia no longer needs Putin.

After becoming president in 2000, Putin singled out the country’s main enemies and threats and took steps to neutralize them. He also placed Russia’s chief sources of wealth under government control. It is unclear how much of this was motivated by Putin’s desire to gain personally, but what is clear is that he wanted bring stability to Russia after the chaotic and lawless 1990s.

But when a leader tries to enforce stability at all costs, it inevitably conflicts with the laws of nature. Imposing stability on a long-term basis is always an artificial process that requires keeping society within predefined limits. Those limits inevitably stifle the country’s development, diversification and private initiative, and they suffocate the business sector’s ability to be innovative and entrepreneurial. “Forced stability” is a recipe for political and economic stagnation and degradation.

There are five main reasons why Putin is an obstacle to development:

1. The government has been transformed into one big business under Putin’s rule. Everything in the country is bought and sold — except real economic results or technological breakthroughs.

2. The leadership has no strategy for driving the country’s development. The authorities lack a clearly defined vision of the future, and they compensate for that by trumpeting empty slogans.

3. Official propaganda gives Russians an extremely distorted image of the real world. China is painted as a close Russian ally, and the Kremlin’s black PR campaign portray the opposition as “fifth columns” that are on the payroll of foreign nations. This propaganda, however, is based on lies and disinformation.

4. Russia is not developing its industrial sector but is focusing on controlling the country’s main energy and financial sectors. It is unclear how Putin-friendly Bank Rossiya based in St. Petersburg gained control over SOGAZ, Gazprombank and other assets, nor is it clear why the Gunvor trading company — a private company with 2009 revenues of $53 billion and co-owned by Putin ally Gennady Timchenko — is needed as an intermediary in one-third of all Russian oil exports.

5. Hiring decisions for key state and corporate positions are based largely on people’s loyalty to Putin. It is thus no surprise that many of the so-called “Golden 1,000” managers are inept. Perhaps this is one reason behind the 8.9 percent drop in the country’s gross domestic product in 2009 — the deepest downturn among the Group of 20, despite favorable external factors and steady economic development over the same period in India and China.

Russia’s economy is sliding downhill. Its dependence on imports is increasing while exports are decreasing. Most disturbing is Russia is losing ground in its core economic sector and most important source of growth — energy. In 2004, Russia extracted roughly five times more oil than all other countries in the Commonwealth of Independent States combined. In 2008, this figure was 3.6 times more. Even more dramatic, in 2004, Russia extracted 9 percent more natural gas than the United States, but in 2009, it produced 10 percent less gas. Day by day, Russia is sinking deeper and deeper into a systemic economic and political crisis.

It is crucial that Medvedev’s plans to modernize the country are implemented, but this is impossible as long as Putin and his cronies continue to undermine Medvedev. As political analyst Gleb Pavlovsky correctly observed, Putin is one large myth and nothing more. And the sooner Russia abandons the myth, the better.