Brezhnutin? Putizhev? Disturbing and Bizarre, but True

Another indispensable post from the brilliant Russian-watchers at the Power Vertical, one of our favorite Russia blogs:

A new leader comes to the Kremlin in a time of chaos, replacing a bumbling and erratic predecessor. He loves to hunt and drive fast cars. He ushers in an era of stability and relative prosperity, thanks largely to high oil prices. People see the first decade or so of his rule as a golden age.

This could easily be a description of Vladimir Putin. But it also applies to another Russian leader — Leonid Brezhnev, who ruled the Soviet Union from 1964 until his death in 1982.

In a thought provoking commentary in Gazeta.ru this week, Sergey Shelin draws a compelling comparison between Brezhnev and Putin that is highly relevant to where Russia is today and where it might be going:

What was the real Brezhnev like, not the Brezhnev of the jokes?  He was a person not without charm, he liked to joke, to shoot, to race cars, to chat with the people (with hunters from the hunting establishments). But the most important thing is not the resemblance to Putin in terms of taste, although it is greater than one would like to think. Every leader brings his own political product to the people, offers his own unique range of services.  And as long as this product is selling like hot cakes the leader’s career continues to rise, but when his product mix becomes obsolete and consumers get tired of the services, the leader turns into a walking anachronism.

The early Brezhnev’s political product mix included stability, sensible governance, a growth in the people’s well-being, and other nice things.  It would be stupid to deny today that people liked this, and if the science of opinion polling in those days had known how to measure ratings, they would have been excellent.  But then Brezhnev grew old.  And the fact that he grew old physically somehow concealed the fact that he had also become obsolete, that the people’s demand for his services had declined.  By the mid-1970s even Brezhnev’s most benevolent appreciators were already looking at him with a kind of thoughtful sorrow.

Shelin notes that Putin is now in his 12th year in power. On the Brezhnev timeline, this places us roughly in 1976:

Seemingly a successful time for Leonid Ilich:  He became Marshal of the Soviet Union, he received a third Hero [of the Soviet Union] star on his jacket — but they say that it was in that year that he firs t asked to resign.  The command would not let him go, but he was not asking for no reason.  He understood that he had completed his program and would not add to his glory anymore.

And he was right. The remaining six years of Brezhnev’s reign was marked by economic stagnation, declining living standards, rampant alcoholism, and an increasingly cynical public.

But there is an important difference. Brezhnev was nearly 70 years old in 1976. Putin is 58, which Shelin sees as a problem:

Brezhnev simply could not plan the continuation of his leadership activities for another couple of decades to come.  Putin can, if he wants to.  And the country has not tried such a thing before.  A leader for whom everything is stuck in the past — ideas, formulas, illusions.  In the past — literally everything.  Except the enormous power.

This is where I begin to disagree with Shelin’s analysis.

As I wrote in my last post, Putin understands the lessons of the Brezhnev period all too well: a stagnant economy and moribund political system can sink a superpower. But he also learned the lessons of Perestroika: unmanaged or poorly managed economic and political reform can easily spin out of the Kremlin’s control.

Putin’s plan, I believe, has always been to enact the kind of authoritarian modernization — economic reform with a tightly controlled political system — that his hero, Yury Andropov, sought to carry out before his death.

But Putin is nothing if not pragmatic, and the 21st century is not the 1980s. Andropov didn’t need to worry about the Internet, You Tube, Live Journal, Twitter, Facebook, 24-hour satellite television, and cell phones with video cameras. Putin has been seeking a more creative way to thread this needle — to modernize Russia while not allowing the politics to spin out of his control.

As I have blogged on numerous occasions, I think his plan is to set himself up as Russia’s supreme leader, possibly as general-secretary of United Russia.  This would allow him to bless President Dmitry Medvedev’s re-election bid so he can carry out his political and economic modernization program — albeit under Putin’s watchful eye.

46 responses to “Brezhnutin? Putizhev? Disturbing and Bizarre, but True

  1. Authoritarian capitalism has worked in the past. Russia could succeed if it followed the Singapore or Chilean model. This political economic model calls for limited government intervention in the economic sphere, free market capitalism, while maintaining an authoritarian control of the political sphere.

    Although I don’t agree with this societal model, it has worked in the past. This is Putin’s only chance to reform the country economically and bring about prosperity of the Russian people.

    In the case of Chile, the economic reforms lead to political reforms of democracy and rule of law.

    Putin will never go this way. His powerbase resides with the siloviki, who only know fear, terror and intimidation as the most effective tools to control and motivate society.

    http://www.pressrun.net/weblog/2009/01/singapore-2nd-freest-economy-what-it-means.html

  2. Kolczak,

    Russia is at the stage of desintegrating – unless ALL regions will be freed from russian domination there is NO CHANCE FOR RUSSIA TO SURVIVE LET ALONE TO PROSPER – IT LOOKS NOW THAT RUSSIA IS HEADING FOR THE CIVIL WAR – HENCE NO SERIOUS INVESTMENTS FROM THE WEST.

  3. Bogdan from Australia

    The only way Russia can save itself from a complete degeneracy and self-destruction is to employ as many as possible Ameican retired army officers to all the important administrative positions.
    Pay them well and protect them.
    They are (at least a great majority of them) axtremely professional and honest.
    Well, that’s NEVER gonna happen…
    P.S: I wonder, where Putin and his degenrate cohorts are going to seek asylum when Russia finally collapses and the most unimaginable barbaric civil war errupts.
    In Germany, I suppose. After having their cases supported by Gerhard Shroeder and the German Social Democrats.

    • “The only way Russia can save itself from a complete degeneracy and self-destruction is to employ as many as possible Ameican retired army officers to all the important administrative positions.
      Pay them well and protect them.
      They are (at least a great majority of them) axtremely professional and honest.”

      Dude, with all due respect, but you seem to be living in some kind of a dream land, just look at what these ‘extremely professional and honest people’ have done to Iraq and the whole time they’ve been at it they’ve been protected by US military and private mercenary companies like Blackwater.
      The whole idea is that in the US people like that are kept in check by a sophisticated system of checks and balances, if they’re allowed free reign they always end up looting and plundering no matter what their nationality may be. The problem with Russia is that there’s no checks and balances here and the ‘honest’ KGB are able to do pretty much whatever they want.

      • And where do they buy those checks and balances, Igor? What should Russia do to get them?

        • you can’t buy them, they’re a sophisticated social technology that takes centuries to develop, Russia is hopeless in this respect, at least in the foreseeable future

          • I always enjoy talking to optimists – like you.

            But how do you explain why, say, Slovenia has developed these checks and balances during the last 20 years then?

            And BTW, what exactly are these “sophisticated social technologies”?

  4. Russia is, and has always been, a complete failure. They have a choice between numerous criminal gangs running the show or a single criminal gang running the show. Putin had an opportunity to get them on a possible path to success, but turned out to be a cheap, slimy little crook. Their next chance is probably a hundred years into the future.

  5. Oil! will save Putin’s rear again. Have you seen it go up and up. With Obama in office and the leftist environmental whackos, oil will stay up. Russia will have another bull market and Putin will ride the wave.

  6. Manfred Steifschwanz

    >> Andropov didn’t need to worry about the Internet, You Tube, Live Journal, Twitter, Facebook, 24-hour satellite television, and cell phones with video cameras. >>

    Maybe not. But why does our very dear beloved author suddenly resort to such humility, smugly hiding herself behind the much broader term of “the Internet” ? I mean, Internet without La Russophobe would have been a complete non-issue to the Kremlin. Get real.

    • La Russophobe is a complete non-issue for Putin for the simple reason that only a handful of Russian can read English and as for Russian-language websites that publish anti-Putin/anti-Russian materials such as kavkazcenter.com – they’re blocked in Russia, you can only access them through proxy services, anonimizers or VPN’s and again only a small proportion of the population are able to do that.

      • Manfred Steifschwanz

        >> La Russophobe is a complete non-issue for Putin >>

        Shhh — you don’t write such things on this blog, mind you. Didn’t you know this marvellous site is what the Universe revolves around?

      • I bet Putin is good for Russia if Kavkazcenter comes to your mind as the first example of anti-Putin sentiment.

        It’s like Al Quaeda being the most prominent critics of Bush:)

        • Dude, Putin is so bad for Russia that even the crazy-ass Islamic fundamentalist wannabe’s from kavkazcenter are seeming more and more attractive with every passing day.
          There are other saner alternatives within Russia, but the problem is the media outlet they still have access to is the Internet and with Russia’s laughably small Internet penetration of just around 30%, it’s pretty much irrelevant what they publish in their blogs, since very few people read them. The vast majority of the population still get their news and their political views from TV, which is totally controlled by the state.

          • Ay, Igor, I’m tired of this. Your perception of Putin’s role is too emotionally driven to discuss it – once again.

            As to “saner alternatives”, you haven’t name one since the last time.

            All opposition forces have full access to internet, and that is 50% of Russian voters. Still they manage to gather 1,000 people for their demonstrations in Moscow, a city of 14,000,000. Can’t say this is really an “alternative” of any kind.

            • I’ve lately seen a research for the EU, 2010, sample representative for Russia .

              50% said they were getting news on international and domestic politics from the net, compared to 80% for TV. Radio, the next popular, has around 30%.

              As for the international politics, internet is #1 with 60% against 50% for TV.

            • as of June 2010 the estimated Internet penetration in Russia is 42.8% (http://www.internetworldstats.com/euro/ru.htm)
              I already talked about the problems with our opposition, they’re all yesterday’s jam, disgruntled former politicians by definition incapable of winning the trust of the people, thus the low turnouts at their meetings and marches, essentially the only people they manage to get to march with them are probably their friends and friends of friends. I mean how can someone like Kasyanov be taken seriously – the guy was in Putin’s first government and then everything was fine but then as soon as he got booted out he all of a sudden started reinventing himself as an opposition leader.
              Now compared to people like Kasyanov, the people behind kavkazcenter.com are at least perceived as more honest; they’ve been fighting against Putin’s regime for over a decade now.

              • 42,8% is at home internet connection. Plus, many people have it on their mobiles and/or at work. Makes the 50% number quite credible.

                I agree that we lack normal political parties and opposition here.

                As to the “people behind kavkazcenter.com” being honest – you know, I don’t think honesty is a virtue of terrorists…

  7. Sorry Kolchak, but oil is not going up. Energy costs are destined to trend down because huge amounts of cheap natural gas has become available. Uptrends will always be temporary.

  8. Oil hits a two-year high, Ron remains unperturbed.

  9. Oil etc. – quite a few analysts seem to be expecting hyperinflation to hit in the US in the next couple of years, if those fears materialise and the US goes into a deep and long Great Depression style recession, everyone is going to suffer as a result, including Russia and oil price will go down as a result, probably even all the way to the 1980’s levels.

    • Main threat to the U.S. economy now is deflation, surprisingly enough

      • but last I heard after the fed’s second ‘quantitative easing’, i.e. where they decided essentially to print money to lend to the federal government, the most savvy have already started dumping dollars and buying up commodities, causing the prices of the latter to rise and that is an inflationary trend and some doom-sayers like Gonzalo Lira are already predicting hyper inflation in the near future.

        • Well Igor, I am not an economist, and this is very difficult to understand, but the best I understand it is this. Inflation is very low, certainly below 1 % annualized. This will be the second year in a row (and the second time in history) when there probably will be no cost of living adjustment for the recipients of Social Security payments. Fear of deflation, however is enormous due to a very weak demand, many leading economists including Nobel prize winners are talking about similarities between this current situation and the so-called Japanese “lost decade” of the 1990’s.

          Fed cannot cut short term interest rates anymore, it’s already below 1 %, so they try something else, like that easing thing, i.e., buying federal bonds. I guess they worry about deflation too, not inflation

          • Well, whatever, my point was that the global oil prices depend to large extent on what’s going on in the US economy, I recently read somewhere that the US accounts for over 60% of global consumption, so if the US economy goes into a serious recession the prices of oil and probably a number of other commodities will take a dive.
            When talking about oil prices, and what’s going to happen to them in the long term, I don’t think one can say with certainty whether they will decline or not, for one oil’s used for a lot of things other than making fuel (like in petrochemical industry) and for second it still remains a rather scarce resource and over the past decade or so various scientists have been predicting how we’re going to run out of it in the next twenty to fifty years or something like that and when something is scarce its price usually remains high.
            Of course when Russia runs out of its mineral resources it will probably just cease to exist.

          • And Ron’s claim above that energy prices are bound to decline over the long term because ‘huge’ reserves of natural gas were found, I don’t think it’s valid.
            For one, unlike oil, natural gas is not that easy to transport. It can be liquefied, but my understanding is that very expensive facilities have to be built for that plus liquefied natural gas has to be transported in special containers etc., the way Russia just pumps it down pipelines is pretty expensive too, for one you have to build the pipelines first and then you’re pretty much at the mercy of the countries your pipelines go through. Like Russia and Ukraine or Russia and Belarus, for all of the Kremlin’s posturing, Lukashenko and the Ukrainians pretty much have Gazprom by the balls – if push comes to shove they can just cut the pipelines and Gazprom will have no way of selling its NG to Europeans.
            So NG is a fairly expensive energy resource, I don’t see how its prices can just keep going down with all the expensive logistics involved and with its relative scarcity taken into account, I mean, no matter how huge some new deposits that’ve just been discovered may seem, they still won’t last forever.
            And then there’s nuclear power, it’s theoretically inexhaustible, the only problem with it is that after Chernobyl nobody wants nuclear power plants anywhere near their homes. And on top of that they’re really expensive too.

          • @”certainly below 1 % annualized” –
            2,7%, actually.

            @Fed cannot cut short term interest rates anymore, it’s already below 1 % –
            But the economy just doesn’t rise, huh? Perhaps the problem of your economy in general is not lack of funds? Perhaps it’s all about losing to other nations, competitors which are cheaper, faster, more flexible and closer to markets?

            • Whatever our problems are, we would not need lessons from you or from your country on how to solve them. We still produce over 20% of world product, and your beloved Russia cannot even grow its own food. If we do have some competitors, Russia is not one of them. Just concentrate on your oil and gas, and when you are done with that, there will be no Russia, as Igor said

              Instead of gloating, think what would happen to the Russian economy if the commodity prices fall, which would happen if the U.S. economy does not recover soon. I guess you cannot think about that. Hatred of the West (and of America especially) is still your most important contribution.

              • Once again, China consumes commodoties, not the US. US economy is all about sub-primes lately.

                • U.S. economy generates annually 14 or 15 trillion dollars worth of products and services. Are you denying this? If you are not denying this, don’t you think it takes lots of commodities?

                • Dmitry in economy demand is just as important as supply, why the US is key to global economy is not because what it produces or doesn’t produce, it’s because of how much it consumes (like I said about 60% of global consumption), that’s why everyone’s talking about consumer confidence in the US so much; if the Americans stop buying stuff, all those factories in China will have nobody to sell their products to – while consumption has been growing in China recently, they still remain largely a comparatively poor nation with an export oriented economy, still incapable of consuming all the stuff they make, thus if the Americans stop buying all those mad-in-China things, the Chinese will be forced to start shutting down excess capacity, laying off excess work force and cutting down on the amount of commodities and mineral resources they buy from countries like Russia.
                  That’s global economy for you, it’s all about specialisation – Russia specialises in extracting its mineral resources, China specialises in processing those mineral resources into products, the US and Europe have been specialising primarily in consumption over the past couple of decades (whole factories have been literally ‘moved’ to China from Germany, including all the plant and equipment) but this leads to a very high degree of inter-dependence.

                  • It’s a good analysis. The West consumes a lot, obviously, but also still produces tremendous quantities of goods and services

                    • The West is sinking in debts. That’s all you need to know about the Western consumption/ production ratio.

                  • Igor, right you are – and everybody’s worried b/c they see it’s a big bubble again – and one day the US would not be able to support all debts they have.

                    But I can’t see why we discuss influence of this scenario on oil prices at all. If the US (and British, and half dozen other Western debtor countries) economy crashes, falling oil prices would be the least important problem…

                    Another tendency you fail to notice: China has HUGE reserves of internal consumption. Milk prices doubled when Chinese started to drink milk lately. What if they start to use TVs they produce? Who would need the American consumption? What would happen to this interdependence you speak about?

                    • Actually the Chinese government is extremely worried about the US and the rest of the west not buying.

                      China has a huge population sure, except the vast overwhelming majority live in abject poverty (a lot like Russia) and are incapable of even remotely taking up the slack.

                      Thats what happens when you export and keep wages and your currency artificially low.

                    • Andrew, I think you underestimate BRIC.

                      Your reasoning is repeated in this article, for example:
                      http://www.bearishbull.com/?p=36

                      But the statistics disprove it:
                      http://www.rba.gov.au/publications/bulletin/2010/mar/3.html

                    • “According to Peking professor Michael Pettis – and despite disposable income growth of perhaps 15% annually since 2000 – “Consumption growth is anaemic.” Private Chinese gold demand, in contrast has risen by 26% annually in the last decade (Dollar value, WGC figures).”

                      It’s not they are poor. It’s just they save, while you spend, Andrew.

                      Funny picture inside.
                      http://www.pagetutor.com/trillion/usdebt.html

              • And yes, no hatred towards the US at all, whatever you imagine.

                It’s just gold looks much more credible asset than the USD lately.

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