A Kremlin Made of Sand

When Vladimir Putin returns to the Russian presidency on Monday, May 7, the pageantry surrounding his inauguration will aim to portray a picture of unassailable strength, a confident master of his domain invulnerable to pressures from within or without. But things are not quite as stable as they seem. Over the next few years, Russia’s domestic and foreign policies will be shaped by an unfolding and increasingly sharp conflict between the consequences of the two events that took place in the past four months: Putin’s reelection and the ensuing mass protests that erupted in more than 100 of the largest Russian cities.

Yes, the protesters represent a small minority of the Russian population, as the Kremlin never tires of reminding us, and the demonstrations seem to have sputtered out for now. But what of it? When has there been a truly great modern revolution started by a majority of the people? Or one that took place all at once?

Instead, what we may be seeing is a Russian version of a familiar post-authoritarian democratization that swept through Greece, Portugal, and Spain in the 1970s, South Korea and Taiwan in the 1980s, and Mexico in the 1990s. Having reached unprecedented prosperity and personal freedom, the middle class in each of these countries began to demand a say in how its country was governed.

This is not just a political conflict. It is a clash between two moral sensibilities, two political moralities, and two visions of what constitutes meaningful and dignified citizenship. This means that neither side is likely to give up, retreat, or compromise. It will be a struggle to the bitter end, no matter how long it takes.

But it may not be that long. Before Putin’s reelection, a poll showed that 35 percent of Russians polled said they thought the election was "dirty" — i.e., fraudulent. That means that, with all the caveats and margins of errors, millions of Russian citizens do not consider Putin a legitimate president. They were convinced that the Central Election Commission, the Kremlin’s wholly owned subsidiary, would produce whatever numbers the boss ordered.

The Kremlin is well aware that millions may feel angry and cheated, which is why no meaningful liberalization is likely after the inauguration. Authoritarian regimes do not tinker with the system when they feel insecure. With the regime badly needing to bolster the legitimacy bruised in the Duma and presidential election, foreign policy is likely to be shaped by the domestic need for an external enemy. So I would not expect any new "resets." Quite the opposite is more likely, as this week’s threats by high-ranking military officials to strike preemptively at missile defense sites in Europe remind us.

But everyone, including top government ministers and establishment economists, know that even with all the nationalist bluster Moscow’s PR shop can kick up, the system cannot continue indefinitely without a radical de-centralization of politics, the economy, and the justice system. Foreign investment is down, and net capital flight is at a record high so far this year because of what investment analysts euphemistically call an "unfavorable institutional environment." Translated into plain English, this means Russia has a perverted legal system, with courts for sale, universal and absolutely shameless corruption, shakedowns of businesses, thievery, and inefficiency.

In the short term, Russia’s most serious risk stems from a near-fatal dependence on the price of oil. Twelve years of Putinism have moved Russia perilously close to being a petrostate, with all the political, economic, and social niceties those are known for. According to UBS analysts, a $10 change in oil’s per-barrel price changes the price for balancing the budget by 1 percent of Russia’s GDP. Last September, Alexei Kudrin, then finance minister and deputy prime minister, estimated that if the price falls to $60 a barrel, Russia’s economy would register zero growth or even contract. To balance the national budget in 2004, Russia needed oil at $27 dollars a barrel. Last year the break-even point was $115. Thus far, the projection for this year is $117.

This is why Russia is likely to face a severe fiscal crisis as early as 2014, even with the world’s third-largest hard currency reserves. In the words of one of Russia’s most respected economists, Sergei Guriev in a recent talk at the Center for Strategic and International Studies in Washington, the state may "run out of cash" to pay for the huge increases in the defense budget and the social commitments Putin ratcheted up on the way to reelection, first and foremost the pensions of retiring baby boomers.

Yes, countries can tighten their belts. But this task, politically risky enough even in mature democracies like France or Britain, could be fatal when millions may believe that the president’s election was fraudulent and his rule illegitimate. The regime’s worst nightmare is that millions of angry pensioners may join the hundreds of thousands of middle-class protesters.

These protesters are not quite a full-fledged political opposition yet. But they are already something ultimately more threatening for the regime. They are a civil rights movement. They reject the system not so much because of specific political or economic grievances (though they have plenty of those as well), but because they find it indecent, undignified, offensive, and unworthy of them as people and citizens. This is a morals-based movement against effective disenfranchisement and inequality before the law, owned by the state. "Justice" (spravedlivost) and "equality before the law" (ravenstvo pered zakonom) are among the key slogans at the demonstrations. Sound familiar?

I first came across this moral essence of the Russian discontent when I traveled through Russia last summer and interviewed leaders and activists of grassroots organizations and movements. Five months later, I read the same slogans on the banners of demonstrators in YouTube videos, as well as in photographs, blog posts, and interviews with Russian and Western reporters: Don’t lie to us! Don’t steal from us! Listen to us! Don’t step on us! We are not a herd! We are not a faceless crowd. We are the people!

I was reminded of these words by an unexpected development on March 4, the day of Putin’s reelection. In a total surprise, opposition and independent candidates won 71 seats in Moscow’s 125 district municipal legislatures — around 1,500 seats total. Still a tiny minority and with little power, almost all the winners were under age 30 and ready to struggle for a long time.

One of them was a 20-year-old journalism student named Vera Kichanova, who won a seat on the district council in Moscow’s Yuzhnoe Tushino district. The American media — bless ’em! — duly noted her "outsized boxy glasses," "pageboy haircut," and "multicolored tights." But fortunately, they noticed something else. She was a member of Russia’s tiny Libertarian Party and an admirer of the American Tea Party. Ideally, she said, she would like Putin to say, "I’m tired; I am leaving." But as this is not going to happen, her plan was to follow small steps. "If you see a breach in the iron wall," she said, "it makes sense to try to go through it."

And this is as good a summary as I’ve heard anywhere of what has happened to Russia in the past few months — and of what is likely to happen next.