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"There's no money. You hang in there. Best wishes! Cheers! Take care!”
--Dmitry Medvedev
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Statists vs. (Neo)Liberals

It’s not often someone in Putin’s court tells the him something he doesn’t want to hear. But that is exactly what Alexei Kudrin did at a meeting of the Presidential Economic Council, according to Vedomosti. Kurdrin was tapped to head the council in early May to propose ways to get Russia out of its economic morass.
 
As with many Kremlin shuffles, Kudrin’s return to Putin’s side triggered speculation as to what it all meant.
 
A so-called Kremlin liberal, Kudrin and his proxies were quick to begin floating austerity measures and stress the necessity of foreign investment. He also called for a much needed restructuring of Russia’s judicial institutions.
 
He’s how Vedomosti summed up Kudrin’s diagnosis and Putin’s response:
 
According to three participants on the council, Kudrin spoke of the necessity of attracting foreign investment. Russia lags behind technologically, and Kudrin urged, they said, the country should integrate into international supply chains, even in a supporting role. And he insisted that Russia needs to reduce geopolitical tensions. Russia didn’t start them first, Putin said in his closing remarks, say Vedomosti’s sources. Putin said that although the country lagged behind, it has never sold its sovereignty in its thousand-year history, and in the words of two participants, he promised to defend Russia no only while he’s President, but until the end of his life. Another council participant said that the President added a conciliatory note: Of course, we don’t need to increase tensions or fall for provocations.
 
Russian conservatives typically responded to Kudrin’s diagnosis with derision. “Kudrin’s economic program is actually trading IPhones for sovereignty. That’s it.”
 
The security services organ LifeNews upped the ante and smeared Kurdin and Moscow liberals more generally as Islamist allies.
 
As always, Russia’s elite can’t extricate themselves from statist vs. (neo)liberal paradigms. At some point someone is going to have to reconsider if this binary is applicable in the 21st century.
 

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There's No Money

There's no money! But hang in there!
Elections for the State Duma are on September 18 2016
Dmitry Medvedev had another fine week. Ever the pun of many jokes, Medvedev wrote another punchline for himself when he told Crimean pensioners that there is “no money” to raise their pensions “but hang in there. Take care!”
 
Unsurprisingly the video went viral and generated hundreds of sarcastic responses.
 
Medvedev’s gaffs along with the seeming ineptitude of his government even spurred Nikolai Mironov to explain in the ever Kremlin friendly Moskovskii komsomolets "Why the President needs a Bad Prime Minister.” It’s a biting commentary especially given where it’s published:
 
On the one hand, we see that the President has huge approval ratings. On the other, the economy is rapidly falling, the social safety net is crumbling, and as a result, there’s a high degree of public discontent with the government. How is it that the head of state has managed to maintain popularity as the country’s foundation crumbles?
 
In my view, the logic of this social attitude was nicely formulated by a taxi driver I recently rode with, "We have Putin going gangbusters on the West, America, Syria, and the Donbass. And Medvedev has to deal with the economy instead of sitting and playing on his iPhone." And then he gave a piece of the bad news: there is less work, prices are rising, and its unclear where it’s all going.

The taxi driver actually reproduced the classic propaganda formula he hears on every day on TV. In addition to America being the root of all our troubles, there are also bad officials and liberals. The government is clearly underperforming, and the president is very busy with foreign policy and lifting Russia up from its knees. He’s kind of the country’s sacred patron saint, her guardian angel, and officials’ shortcomings don’t stick to him.

Of course, a cognitive dissonance would arise if you logically think it through: the president has an enormous amount of power. He appoints the government, and can, if he wants without the advice of anyone, fire any minister, including the Prime Minister. His power of decree gives him the right to initiate any reforms. And the State Duma is in his grip because the majority are members of United Russia. Why then doesn’t Putin appoint a good team, dismiss corrupt officials and announce a new policy of the country? After all, how will he raise it from its knees if the economy collapses? If he is weak and unable to do it, then why support him? If he does not want to, this is just as bad. But the people, little versed in political institutions and not seeing any credible alternative on the horizon are ready to believe that "it’s difficult for Putin," "he’s fighting the good fight,” and "he’s being hindered."
 
The massive pumping of this line into people’s heads allows the authorities to preserve the system and not change anything fundamentally in it, while maintaining the current “business as usual” favorable to the elite. And this is beneficial for the elite because if the government decided to reform the economy, their material interests would inevitably be hit, and force them to give up some of their comfort and mega-profits.
 
However, while the actual costs of the crisis primarily cry out to the masses, you still need someone to be the supreme whipping boy for the virtual beating. This is exactly the role of the "appointed" government (minus Shoigu and Lavrov) and figurative "liberal circles" allegedly having covert influence on officials.
 
It’s obvious that now the head of state cannot officially support the present course, which brought mass poverty to the population. To equate the state of the country with the President would be, if not suicide, then certainly a powerful blow to his popularity. But Putin has no intention of changing course for the reason above (the interests of the elite). This is why on the eve of the election campaigns the President will be deliberately "uncoupled" from the domestic agenda and it will be "pinned" on Medvedev and his government. And as a result the Prime Minister will no longer be the second person of the state, but an "expendable" scapegoat.
 
I quote this op-ed at length because in addition to being a keen analysis, it cuts to the heart of the Kremlin spectacle. Everyone has their role to play—the siloviks and the liberals, Putin and Medvedev, the opinion polls and TV, United Russia and the elections—in the bigger game on the horizon: a fourth term for Putin in 2018. As Mironov stresses it all comes down the elite:
 
Medvedev will draw the flame to himself during the Duma elections campaign, however thanks to “managed democracy” this flame will not turn into a fire and engulf the authorities and the elite. The president should remain unscathed because the main strategic game is about the 2018 Presidential election which are key for the elite.
 
Speculation about the inevitable fall of Medvedev has swirled for years. But it’s clear that he hasn’t lost his usefulness. Perhaps, Mironov speculates, his time will come after the Duma elections when after getting an electoral “mandate” Medvedev will push austerity through because “someone has to pay for the economic crisis and that “someone” isn’t going to be the elite.” As 2018 approaches, the reforms slammed through, Putin, again to position himself as the “people’s savior” will ditch Medvedev and stroll into a fourth term.
 

Wages Falling but Hang in There

Speaking of Dmitry “There’s no money” Medvedev, an employee at Alfa-Bank decided to jump in the comedic fray with a Facebook post showing a smiling Alfa representative pointing to a sign reading “Hang in there!”
 
Real funny when you consider the Alfa Banking Group’s net profits grew by 15 times to $480 million in 2015.
 
Or if you consider the average monthly salary in Russia is now on par with Kazakhstan and Belarus.

The weak ruble caused the average Russian monthly salary to total just $558 last year, a 34 percent decrease compared to 2014, a report from Moscow's Higher School of Economics (HSE) found.

In comparison, the average monthly wages in Kazakhstan and Belarus last year were $549 and $415 respectively.

Between the years of 2011 and 2015, wages in Russia were consistently higher than in other former Soviet countries. In 2014, Russian saw their earnings shrink by 10 percent compared to 2013 to $847 a month. Experts have noted that the salary gap between Russia and other post-soviet nations is gradually decreasing, RBC reported.

Bad Governance

The Russian Reader has translated an excellent Vedomosti column by Vladimir Gel’man (to hear my interview with Gel’man) on one of my favorite topics: governance. Gel’man writes:
 
Post-Soviet bad governance appears not as a grab bag of discrete, particular defects but as a consequence of the prevailing political and economic order in these countries. Its most vital feature is the fact that rent extraction is the principal purpose and main content of governance at all levels. So the mechanisms of power and governance tend towards a hierarchy (the “power vertical”) with a single decision-making center that seeks a monopoly position, while the autonomy of economic and political actors within the country vis-à-vis the center is relative and can be arbitrarily altered and/or restricted. In turn, formal institutions (constitutions, laws, etc.) are a byproduct of the allocation of resources within the power vertical. They are meaningful as rules only to the extent they contribute to rent extraction. As part of the power vertical, the government administration is divided into organizations competing for access to rent and informal cliques.

Russian Writers Union's New Member

And as if things aren’t absurd enough already. Russia’s Writers Union has a new member: Investigative Committee chief Aleksandr Bastrykin. You know the one that threatens journalists and ruminates about how Russia should quit all the pseudo-democracy nonsense.

But in Russia it pays to be a big player, even for someone like Bastrykin, who’s known to have few allies in the elite. And the sycophancy was on full display. Here’s how SK spokesman Vladimir Markin concluded:
 
The meeting’s participants noted the value of such books by Alexander Bastrykin as Dactylography: Hand Markings and The Murder of S. M. Kirov which popularizes the investigator’s work. About that book, Valery Ganichev [the chairman of the Writers Union] noted that "he read Aleksandr Bastrykin’s book with his daughter as a detective novel. Bastrykin thanked Ganichev for his membership and added “that [it] will oblige him to continue his writing.” 
Oh, my.

Recommended Reading

The Guardian has a nice article on a new exhibit of Soviet children’s picture books.
 
Boston College historian Nicole Eaton talks to the National Interest about her research on the Russian-German encounter in the sovietization of Konigsberg-Kaliningrad.
 
Meduza has translated into English an excellent article on the life of transgendered people in Russia. A must read.

Kevin Rothrock delves into the latest sexual harassment scandal in the Russian opposition at Global Voices RuNet Echo.

Joshua Shifrinson examines the archival record behind one of the biggest diplomatic controversies of the post-Cold War, "Deal or No Deal? The End of the Cold War and the U.S. Offer to Limit NATO Expansion." 

The Russian Reader translates the Village's conversation with four Russian 16-year olds on occasion of International Children's Defense Day. The kids are alright.
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