Homo sovieticus is Dead. I thought You Should Know.

Ok, not that H. sovieticus--the passive, alienated one.

The other one.  The steadfast heroic patriot of past glories, capable of unlimited sacrifice, that Russian President Putin keeps talking about.

Given the frequency and passion with which Russian politicians and Russian proxies in eastern Ukraine invoke the past glory of Soviet power under Russian leadership, you would think H. sovieticus is alive and well.  He is not, and, as the current popularity of zombie fiction teaches us, the walking dead can be a real nuisance.

H. sovieticus is alive in the minds of the Russian leadership--foremost President Putin--because they believe that Russia is confronted by the same existential external threat from Nazism that the Soviet Union faced during WWII, and they tell themselves that Western antagonism toward Russia continues today as it did throughout Soviet history.  Therefore, they believe that even now the times require the same steadfast heroism and defense of Russian identity as did the past.

Part of the Russian leadership’s narrative has merit.  Russians are justly proud of their H. sovieticus fathers and grandfathers, mothers and grandmothers.  H. sovieticus was born in 1917 in response to harsh economic and social conditions and a crumbling political order brought to a head by World War I.  H. sovieticus then endured the hardships of brutal internal political and social oppression and the savagery of World War II.  At the same time, H. sovieticus transformed Russia into an advanced industrial economy with many notable achievements and into a global power.   During this time H. sovieticus’ material well being improved also, although it did not keep pace with improvements elsewhere in Europe.

But in its later years H. sovieticus lost direction when the compelling challenges of an earlier time disappeared and the politio-social imperative of communism lost its value.  The objective of the Russian leadership became merely to preserve the Soviet Union in its existing form while its economic and social condition slowly crumbled until the union collapsed.

Resuscitating H. Sovieticus only places the current Russian leadership in the same leaden shoes as the leadership of the late H. sovieticus period.  Just like with the zombie apocalypse, it is not possible to resuscitate an appealing corpse.  There has been too much decay in the interim.

In this case the zombie contagion is a political recidivism based on a contrived Nazi threat and nostalgia for a prouder, more powerful Soviet Union without the fatal flaws.  The walking dead stumble along because the memory of H. sovieticus fills a vacuum left by a Russian leadership that failed to explain to a bewildered modern Russian populace that the Soviet collapse was a domestic political and economic failure of massive proportions.  They failed also to provide a more enduring model for future sustainable political and economic well being.  This left open the door to attribute the collapse and the current difficulties to an external antagonism and deflect attention from enduring domestic weaknesses.

The threat of a resurgent Nazism--or a general Western antagonism--is a jumble of contrived arguments because these lack a foundation of any compelling threat.  Despite persistent agitation and mainstream hand wringing, the far right is not in power in any European country, and no far right party advocates invading Russia—quite to the contrary, the far right admires Putin’s authoritarianism.  NATO may be at Russia’s door but that is because Russia’s neighbors fear Russian aggression.  At the same time, NATO doesn’t have in place anywhere near the capacity to invade Russia.  It can only make a Russian invasion of Europe highly costly to Russia, which is the defensive purpose of NATO.  The false analogy of Nazism to NATOism, and outright falsehoods in the Russian media, serves only the purpose of those who need an external threat to explain Russia’s diminished circumstances and to justify policies to exclude certain influences and suppress certain domestic challenges that threaten their own political authority. 

Putin’s recidivism is multiplying the suffering of the Russian people through a combination of misdirected economic and social policies and oppression, much as the Soviet government oppressed H. sovieticus.  Putin has unleashed his own victimizers—not just the dogs of war but the social predators, corrupt politicians and favored oligarchs who act with impunity.  Hostile acts such as the seizure of Crimea and sponsorship off invasions in eastern Ukraine, Georgia, Armenia and Moldova are used to deflect attention from the genuine internal threats to modern Russia’s well being.

The current Russian leadership’s behavior, at times blustery, hostile, suspicious and paranoid, is evidence of a bankrupt leadership in extreme duress as Russia finds itself without a coherent national purpose, isolated by corruption, diplomatic folly, sanctions and a crumbling economy, and lacking an engaged civil society that can help solve its problems instead of receiving instructions from above

The breath-taking lies and deceit practiced by Putin’s Russia have been tried by only a handful of failed states, most notably Nazi Germany and North Korea.  These states endure only as long as their instruments of oppression can cow the people and national bureaucracy into submission.  They collapse at the moment control is shaken, as it always is by some aspect of objective reality that is impossible to ignore or sweep under the rug.  National leaderships that drive a national narrative that does not align with objective reality fail irrevocably and are quickly relocated to the dustbin of history.

H. sovieticus rose to the challenge of his time, and modern Russians need to rise to the challenges of their time.  Rather than latch on to imagined external threats or past models of subservience to the state, they need to build a durable political and economic foundation for the future, while preserving past achievements and honoring past sacrifices.

The modern Russian, descendent of H. sovieticus, has to deal with real internal problems that lack however the laser clarity of war.  This time all the threats are all internal and diffuse.  They include economic erosion, a demographic crisis due to a falling population and failed public health services, the ineffectiveness of government services, antiquated and inefficient business infrastructure, lack of a moral foundation to guide relationships (including equity before the law), and lack of a strategic response to actual external challenges, such as an emerging Chinese powerhouse on its southeastern border, Muslim extremism on its south central border and the example of a stable, prosperous Europe on its western border. 

Modern Russians do not aspire to the suffering of H. sovieticus.  They are no longer one generation removed from serfdom and threatened by war, and they know more about the opportunities and pleasures of the world, including the rewards of self-realization.  Indeed, they have mastered some of these opportunities and have the capacity to enlarge upon them if allowed.

Russia needs a new identify that is based on stability, prosperity and equity among all citizens, as well as fraternity with other nations.  The measure of success will be a secure, prosperous Russian people, not a H. sovieticus with unlimited capacity to suffer misfortune and failure.

(An insightful analysis entitled ”The Long Life of Homo sovieticus” appeared in The Economist December 2011.  It was remarkably accurate in describing the subsequent evolution of Putin’s rule.  It is worth a read even now (Economist.com/node/21541444).

The Tide Turns Against Russia

Against dire expectations, it is a quiet summer in Ukraine.  Fighting in the east has turned into tit-for-tat shelling, terrible in itself, but not the Russian invasion many expected, and so far Ukrainian debt negotiations lack the visceral drama of, say, a Greek default.

In fact, the relative calm points to Russia having lost the initiative in the Ukrainian crisis.

The tide has turned against Russia, diplomatically, politically, economically and militarily.  Its resources to conduct a coherent national strategy are overstretched and it is increasingly isolated.  Its economy is suffering and the political consensus in Russia is increasingly brittle.

Not only is Russia’s path out of the crisis not clear, but the ground is eroding beneath its feet.

Diplomatic Isolation

Russia is out of friends.

The G7 summit in June--absent Russia--came out firmly against Russian aggression in Ukraine and elsewhere, even warning of “further restrictive measures” if Russia or its proxies in eastern Ukraine attempt further aggression.  To the surprise of many, the G7 also renewed condemnation of the seizure of Crimea, which had gotten little lip service recently.   Reinforcing the tone, European Council President Donald Tusk commented that if anyone wanted to open debate on sanctions “the discussion could only be about strengthening them.”  

Despite fears of backsliding on sanctions by some EU members, the G7’s firm tone signaled stronger European resolve, as well as a tougher stance by others, such as Japan.  Sanctions appear secure not only this year but likely into the indefinite future given the poor prospects that Russia will fully comply with the Minsk II agreement for ending hostilities in eastern Ukraine.  

Russia’s pivot away from Europe with overtures to China, North Korea, Turkey, and Iran, has resulted in a handful of commercially questionable deals or down right embarrassment, such as when Moscow touted the participation in Russia’s May 9 celebrations of another marginalized autocratic leader, North Korea’s Kim Jong-un, only to have him drop out at the last minute.  Alone among significant world leaders, China’s President, Xi Jinping, did attend the May 9 celebration but, given Russia’s weaknesses, China’s economic strength suggests Xi Jinping was not there to solicit Russian cooperation but to bargain shop.  Most recently, the much-touted Russia-Turkey gas pipeline has hit significant snags, with Turkey threatening arbitration on pricing terms.  All is not going well.

No longer passive or apologist, Europe’s political center, though pressured from the left and the right, is uniformly firm against further Russian influence, under the leadership of Germany, France, and smaller frequently more vocal states, such as Poland and Lithuania under outspoken and tech savvy communicator President Dalia Grybauskaite.

At the same time, the European press is increasingly alert to Russian influence in EU and national European politics.  The European press writes increasingly about the flow of Russian money to support extremism on the left and right, casting light on Russia’s effort to subvert European policy against Russian aggression, not to mention tracing the ill-gotten, concealed wealth of Putin and his oligarchs.

If deteriorating international relations were not enough, the ball is clearly in Russia’s court to find closure on the downing of MH17.  Without an acknowledgement of culpability, Russia is unlikely to restore normal relations with Europe and Malaysia and other countries that lost citizens in the tragedy.

Political Fragility

Internally, President’s Putin’s support seems rock solid.  The latest poll indicates a record high 89% approval rating.  However, over-reaching by Putin has made the political consensus brittle, elevating the risk of political turmoil.

To begin, the loyalty of the political class and the important middle class are under threat as never before.  The raison d’etre for Putin’s support, stability and continual improvement in economic well-being, has evaporated in the face of economic recession and conflict on Russia’s borders, dramatically increasing both political and economic uncertainty and opening the door to social turmoil as the new reality hits home.

Nervous shock waves are already rippling through the political class following opposition figure Boris Nemtsov’s murder.  As yet unsolved, his murder is fueling political backstabbing and intrigue, especially in the security services, the backbone of President Putin’s political authority.  The murder of Nemtsov, and more recent poisoning of civic activist, Vladimir Kara-Murza (and a long trail of past unsolved high profile murders), have established that murder is unarguably an instrument of political oppression in Russia, no matter who is behind it, greatly raising fear and loathing among President Putin’s supporters as well as the opposition.  Widening fissures, whether between branches of the security services, the regions and Moscow, or between economic clans, will ultimately let loose corrosive infighting that will unsettle the existing political balance.  The lack of outlets for dissent, or even opposing views, will prove explosive.

Nonsensical claims by Putin and his media, such as that the Molotov-Rippentof agreement was a sound and logical response to Allied indifference or antagonism to Russia or that the 1968 invasion of Czechoslovakia was a defensive response to a planned NATO coup, as well as countless examples of Russian media distortion and falsehoods about the conflict in Ukraine—not the least of which is that Russian soldiers are not serving and dying there--make a coherent Russian political narrative increasingly difficult to maintain and the existing narrative will collapse under its own inconsistencies and improbabilities.

Narrative incoherence is matched by the fantastical, including, for example, legislative proposals from Russian parliamentarians to ban civil and scientific foundations under catchall anti-foreign legislation, ban Russian students from receiving foreign education grants, block Facebook because it promotes gay culture, or review the legality of the independence of the Baltic states.  A great deal of political capital is being wasted in nonsensical gestures that narrow the political base to those with extremist or fringe views.

Indeed, the political hype has made all Russians more aware of how politics affects them personally.  The impact of a constant state of political agitation, slow or stagnant wage growth and job insecurity, inflation, a devalued ruble, travel bans and shortages of consumer goods, is harming a widening circle of President Putin’s core supporters and all Russians.

The brittleness of Putin’s monumental, implausible political narrative means that a slight shift in public mood or a seemingly small catalytic event could drive sudden, disruptive political change.  Think unknown fruit vender in Tunisia and Arab Spring; for example, the rotation of Russian troops through the Ukrainian theatre means more and more Russians know through direct experience or through someone who has direct experience that the Russian government’s version of events is false, including that there are no Russian casualties (without trustworthy media in Russia, word of mouth is a powerful source of information in Russian society).  Just such an event must worry Russian policy makers.  It was public discontent, and the costly futility of the effort, that ended the Soviet military campaign in Afghanistan and ultimately brought down the Soviet Union.  The prospect floated recently in Russian political circles that the 2018 elections could be moved forward suggests President Putin understands the risk and wants to nail down his next term before things get really ugly.  

A Russia on political edge is a poor platform from which to carry out a military adventure, especially one demanding greater sacrifice if the conflict were to escalate in Ukraine

Economic Erosion

While Russia’s diplomatic and political tide ebbs, more than two decades of misguided and incompetent economic policy is sinking the Russian economy, limiting its ability to exert its influence abroad, especially through costly military adventures.

The headline economic growth is bad enough.  Economic growth contracted 1.9% in the first quarter of 2015 and has declined 4.3% since the first quarter of 2014.  Growth in 2015 is projected to be anywhere from -2.5% (by the government) to -10%, and from -2% to +2.6% in 2016 (the IMF thinks 0.2%).  No one is forecasting a return to the growth rates of the last two decades.

As bad as it was, economic growth year-to-date did not fall as much as many predicted, leading President Putin to declare that the worst was over.  However, other indicators suggest things will get worse.

The economic decline in April was -4.2% year-on-year and in May it was -4.9%.  If the economic slope feels slippery, it is because it is getting steeper.

Underlying indicators also suggest things will get worse.  Wages fell by 9% and retail sales by 8%, falling by more than the overall growth rate in the first quarter, indicating falling consumption will continue to undercut growth further later in the year.

Investment is in free fall as well.  Capital flight will approach $110b in 2015 according to the Russian Central Bank, somewhat less than the record $130b last year, but still a huge drain on capital that will deprive Russia of investment just when it needs it the most.  New foreign investment has all but dried up.  Western sanctions have been in place long enough to become an established economic fact and to bite hard, disappointing Russian policy makers who hoped for a quick return to normalcy, further undercutting business financing and medium- and long-term investment.

Government spending is falling also.  Russia’s key lever of economic strength, oil, hovers well below the estimated $90 a barrel Russia needs to balance its budget, ensuring steep government budget cuts that will undermine directly President Putin’s social contract with the large, public-sector-dependent portion of the population.  Russia announced a 10% across-the-board cut in government spending, except for military expenditures.  Budget cuts will reduce public sector employment and wages and reduce public sector investment, including incentives for private investment in productive sectors, such as agriculture, where economic growth needs to come from to balance the economy and generate new growth.

Russia’s raiding of its reserve funds, semi-forced currency repatriation, special refinancing schemes for favored firms, and other measures to pay its bills, smack of economic desperation.  Worse, the government rewards loyalists, reinforcing an inefficient, autocratic business climate.

The consensus within Russia appears to be that worse is yet to come.  Kirill Rogov, of the Gaidar Institute for Economic Policy (Moscow), has written that Russia avoided an immediate economic collapse due to lower oil prices and economic sanctions, but at the cost of significantly weakening both consumption and investment within Russia.  Alexii Kudrin, former Russian Finance Minister, frequently comments that Russia will likely experience a prolonged period of economic stagnation.  Herman Gref, President of Sberbank  (the largest Russian state-owned savings bank) is quoted as saying that the economic trend in Russia is negative, and “he doesn’t see any opportunities to overcome this trend before 2017.”

Russia’s economic might is ebbing, driven by poor economic management and financial isolation and, as well, the draining cost of Russian military adventurism.  The Russian political and economic elites know how bad the economy is as they seek favors from the government and squirrel away personal safety nets overseas in foreign assets.

Military Stalemate

The tenacity of Ukrainian resistance during major assaults by Russian-led separatists at Donetsk airport and Debaltseva and during incursions, such as Maryinka, has confounded the Russians and the separatists.  They cannot take ground without significant losses of men and material.

Worse from the Russian perspective is that ground is only taken when Russian soldiers lead the advance, exposing direct Russian involvement and resulting in unacceptable Russian casualties.  Moreover, any advance by Russian-led separatists now will certainly result in new and more severe sanctions, including most probably Western defensive military support for Ukraine.

Alone, the separatists lack coherence and are turning on each other, as evidenced by the failure to unite under a single administration areas in Donetsk and Luhansk held by Russian-led separatists and by recent killings, such as of separatist leader Aleksei Mozgovoy.  Russia hopes to control the evolution toward a unified command and stable political structure in the separatist held areas, as it did in Transnistria, but the challenge is greater in eastern Ukraine.  Areas in Donetsk and Luhansk held by Russian-led separatists jealously guard their “independence” from each other, not to mention various “independent-minded” free-lance military groupings from Cossacks to paramilitary criminal gangs.  Russia has failed to ignite the revolt it hoped for across eastern Ukraine and what it holds is fractious and undisciplined.

More importantly and less obvious, though, is that Russia appears to have reached the limit of its military capability.  Russia has thrown in all the military resources it has available without undermining its military preparedness elsewhere in Russia.  In particular, its better-equipped and better-trained military units are fully committed.  Anecdotal evidence suggests the war has already resulted in shortages elsewhere, such as reports of a lack of trucks in Siberia to combat recent, extensive forest fires because these were needed for transport in Rostov-on-Don, the Russian staging area for the eastern Ukraine conflict.

Russia maintains a force of an estimated 40,000 troops near the border with Ukraine, which would perhaps be sufficient for a first wave assault to expand the Russian area of control, but inadequate to hold the ground and maintain control for any length of time against an aggressive Ukrainian response and guerilla warfare.  A Russian advance into Ukraine would have to be significant enough to justify the cost and tilt the political and military balance in Ukraine decisively in Russia’s favor.  That would be an area far greater than Donetsk and Luhansk oblasts.  However, 40,000 Russian troops cannot conquer and hold enough of a country that is larger than Germany with a population of 45,000,000 to make a difference.  Additional forces that Russia might throw in would be of considerably lesser capability.  Russia’s resources devoted to such a campaign would be quickly overextended and eroded.  The backlash in Russia alone, where overt military intervention and Russian casualties are said to be unpopular, would be enough to undermine such a campaign.  The response from the West would greatly exceed what it has managed so far, raising the cost to Russia to unsustainable levels.

Recent comments reported by President Putin and by Russian Foreign Minister Lavrov that eastern Ukraine should remain part of Ukraine likely reflect their realization of the prohibitive cost to Russia of maintaining eastern Ukraine as a docile “independent” vassal state or of absorbing it into Russia proper, much less any larger territory.  The geographic scale and considerably larger population of eastern Ukraine makes holding on to the region in any form considerably more difficult and expensive than holding on to Russia’s smaller existing vassal states, Transnistria, Abkhazia, South Ossetia and Nagorno-Karabakh.  A hat trick Russia lacks the means to pull off.

No Where Left to Go

Never the strategist, ever the tactician, President Putin hasn’t come up with anything new since Minsk II in February.  The once not-to-be-missed St. Petersburg Economic Forum in June showed President Putin whistling in the wind.  He could only repeat assurances made since March, against objective reality, that Russia sought good relations with all countries and that the Russian economy was on the mend.

Indeed, President Putin may find that demonstrating a limited capacity to unsettle Russia’s neighbors rather than compel their obedience may be more humiliating than the Russian fall from global power status that he so deeply regrets.