Russia on the brink of ‘a tectonic shift’ in elite’s consciousness
Freed from the rigid official protocol requirements to defend government’s fiscal and monetary policies, ex-Russian Finance Minister Alexei Kudrin, now in a new capacity as an independent economist, highlighted in one of his recent, post-resignation speeches the downsides of the state’s current economic policies that are potentially capable of throwing the country into a financial abyss.
Before going into some of the points raised in Kudrin’s critique, it needs to be noted here that it was the irreconcilable differences on handling government’s economic policies that the ex-minister had cited for his rather audacious decision not to work with the incumbent president, Dmitry Medvedev, should he eventually switch the Kremlin for the premiership post after the presidential election in 2012. Expectedly, this audacious decision led to the resignation or sacking of Kudrin, depending on whom one asks, as the nation’s longest serving finance minister.
Thus, comprehensively attacking the accelerated spending spree, a core policy of the current political tandem led by the president and powerful Prime Minister Vladimir Putin, Kudrin unceremoniously dismissed this duo’s strategy of radical escalation of state expenditures to simultaneously bankroll bigger pensions, public workers’ wages, defense spending and major overhaul of the country’s industrial sector as ‘a fantasy’ anchored on an idee fixe. For instance, citing a myriad of statistics, Kudrin noted that the current plan for hiking state employees’ paychecks and pensioners’ social packages over the next decade envisages a budget of 20trln rubles, or an increment of 2trln rubles per year for the next 10 years, a substantial part of the country’s current GDP value of about $2.22trln in terms of PPP evaluation.
Similarly, Kudrin also convincingly argued that the government, by pushing its expenditures to unrealistic heights, will be forced to make budgetary cuts of almost 1.35trln rubles or look for its equivalent, should the oil price, currently hovering between $80 and $110 per barrel, were to suddenly nosedive to $60. The latter figure was not taken from the air, as it has been the annual average oil price for the past decade.
Undoubtedly, such astronomical figures will strain any budget, even those generously bolstered by sky-high hydrocarbon revenues, to its limits. The alternative would be to borrow additional funds on the international capital markets. But, again Kudrin warned that such route would be stillborn as the current hazy climate on the international financial markets and growing likelihood of a probable second and more drastic wave of another global economic meltdown will turn such policies into expensive exercises in futility. The ex-minister also called for a new and more conceptual approach to the implementation of the modernization policy, another pet project for the tandem, arguing that a more comprehensive diversification of the economy away from its traditional lopsided dependence on hydrocarbons to other key industrial sectors holds the key to success in modernization of the country.
Such open, bold and objective dissertation of the country’s economic policies by someone, who was in charge of the nation’s treasury for over a decade, and hence knew all the intricacies of Kremlin’s budgetary strategies, means that there is now an authoritative opinion, different from the traditionally singularistic official views on the ways of moving the nation forward on issues of national and international importance in the 21st century. Hence, today, one can conclude that the ‘prophesies’ of former Right Cause Leader multibillionaire Mikhail Prokhorov, who said in September that Kudrin’s dramatized resignation marked the beginning of ‘polarization’ and ‘tectonic shift’ in the Russian elite’s collective consciousness that will be accompanied by the emergence of new public figures with different national development concepts, have started becoming a reality.
Indeed, the unfolding reality unequivocally contrasts with the current status, where open discussions and voicing of independent views, even by the political and business elite, have long become an absolute rarity in the country. A proof of this, if any is needed, could easily be found in the statements of current State Duma Speaker Boris Gryzlov, who is now notoriously on record for saying that the Russian parliament ‘is not an arena’ for political discussions. Against the background of such an atmosphere of political unanimosity, a phenomenon alien to bonafide democratic society, it is, therefore, not really surprising that the current tandem is now feeling the draught of intelligent and useful ideas among the ruling United Russia party, which always looks up to the Kremlin for new strategic policy guidelines, instead of generating them for the government.
Indeed, one of the reasons cited by Putin for the quick-paced formation of his new Russian People Front that includes non-United Russia party members was to ‘inject new blood and attract a new pool of citizens with new ideas on governance’ into the ruling party. A similar reason was also cited by Medvedev in announcing the formation of a new Public Committee of progressive regional governors, other top state officials, key businessmen, journalists and cultural figures that will also include vocal political opposition members, to form a ‘new and constant brainstorming platform’ for shaping official policy strategies for the Cabinet.
These recent developments mean that the country’s leadership has come to realize that having a ‘captive party with a compliant majority’ in parliament that is ever ready to rubberstamp any ideas from the above without subjecting them to due parliamentary scrutiny — a process that normally fine tunes and enriches even the best policy strategies with added legal and political values in more developed democracies — has left Russia bereft of vital ‘second expert opinions’ on all vital issues of state governance.
One of the typical reasons traditionally cited for not voicing divergent views on questionable official policies in Russia has always been the fear of losing high political posts, and with them, the elitist social statuses among top bureaucrats. True to type, Kudrin’s televised sacking decision by the Kremlin over irreconcilable views on state policies with the president is a proof this line of thought. For the titans of Russian capitalism, the reasons for obsequiousness are usually real or imagined apprehensions over possible losses of businesses via cooked-up charges, accesses to lucrative state tenders, and/or loss of personal freedom, as was in the Yukos case. The end result is the nation’s galaxy of multibillionaire entrepreneurs is uniquely famously for their collective political apathy and lack vocal and clear positions on vital public issues, even on key business policies.
However, Kudrin’s audacity in openly challenging the president, despite the risk of being fired, means that not all Russians are ready to continue to remain subservient or sacrifice their consciences for groovy political posts and social statuses. If Kudrin’s rebellious spirit should become highly contagious among other top government officials with latent divergent views, and also with other citizens driven to the brink of despair by unbearably rising social injustice, rampant corruption, insurmountable bureaucratic gridlocks, etc, as noted by famous movie producer Fyodor Bondarchyuk during the United Russia party convention, then Prokhorov’s vision of ‘an imminent tectonic shift’ in the elite’s consciousness that will be accompanied by the emergence of new figures with different national development concepts,’ is at the threshold of fruition, a phenomenon that will only abode well for Russia, its people and economy as well as its current and future international standings on vital geopolitical issues on the global arena.
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