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The Kremlin may well want to encourage speculation as to whether President Medvedev was truly instructing Prime Minister Putin on making state enterprises "comptetitve", but it is wholly unlikely that the two would do anything that wasn't pre-arranged between them. If it were otherwise, a political rupture would be underway, with wide repercussions, and nothing indicates such a thing now. (Of course, human nature being what it is, no one likes to take direction too long from even the most illustrious former boss.)
The follow-up to the President's speech Friday does make it seem, in any case, that Mr. Medvedev is serious and wants to proceed with economic change. (See also here.)
Government-run enterprises are famously less efficient than private ones. Corruption is more likely, too. So, having taken possession of the "commanding heights" of the economy away from Yeltsin era oligarchs, the Putin/Medvedev team (or the Medvedev/Putin team, as you will) may now be ready to privatize again on a broader basis--and with fresh capital from abroad.
At least one critic, economist Vladislav Inozemtsev, thinks Medvedev's words are "inspiring", but "not realistic.".
"The problem," he says, "is that most of the people listening to the speech in the Kremlin’s St. George Hall on Thursday--especially those who sat in the first row--are the very ones who have gained the most from the raw materials-based economy and imperfect democracy that Medvedev criticized so harshly. How will Medvedev possibly be able to overcome the powerful clan in the government and Kremlin that is most interested in continuing the anti-modernization status quo?"
Two trends of Russian government policy seem to be shifting, as witnessed by President Medvedev's major address today in Moscow. The first is the tendency in recent years for government to punish those individuals and companies deemed guilty of economic misbehavior. Now, it seems, the Kremlin is taking a more free market approach.
In foreign policy--connected to business, as well--the Kremlin seems eager once again to bring foreign capital back into the country, and to protect it. Russian leadership also seems to be warming a bit to the U.S., and cooling to Iran.
At least that is the interpretation many are putting on the fairly general statements in the Medvedev speech. See the following report from Stratfor:
Thursday, November 12, 2009
A Speech, the Russian Economy and U.S. Relations
"AS RUSSIAN PRESIDENT DMITRI MEDVEDEV was preparing to make his second State of the State address on Thursday, some major shifts in Russian domestic and foreign policy appeared to be taking place. Those shifts seemed destined to affect not only the speech, but Russia as a whole."
Continue reading "Medvedev Signals Kremlin Policy Shift" »
In the past two decades, the world has witnessed yet another historical opportunity missed: the fall of the Berlin Wall has not led to a logical conclusion – Russia’s full economic, political and even military integration with Europe and the West in general. In the recent past, Russia’s Westernizers’ centuries-old dream of joining Europe was nearly within reach, but then it faded again, to wait for another miracle.
In the 19th century that goal was closer than ever, as Europe and Russia were strongly linked within a unified cultural and economic space despite their religious differences and many political upheavals. Even Fedor Dostoyevsky, generally highly critical of the West, noted that Russia needed Europe, and that Europe was Russia’s second Fatherland.
The Bolshevik coup of October 1917 destroyed the natural process of Russia drifting toward Europe, but the end of the bloody communist experiment should have removed the remaining barriers for that process. However, this has not happened so far. Now, will it take place, at long last? Will Russia even try to overcome the West’s rejection as the balance of world power is shifting to Asia?
Continue reading "Russia's European Dreams" »
Photo Source: Associated Press
If you're looking for behind-the-scenes insight, one of the better places to find it is through reports and assessments from STRATFOR, a leader in geopolitical intelligence, analysis and research.
Yesterday, in its "Geopolitical Diary," the company's analysts took on the issue of Moscow-Tehran relations. Against a backdrop of the Iranian regime's nuclear program and its unwillingness to cooperate fully with the IAEA (International Atomic Energy Agency), STRATFOR suggests that Russia could be "about to shift its international role within the Iran talks."
Russia traditionally has been staunchly against sanctions on Iran. But in the last few weeks, Moscow suddenly grew quiet. During this time, U.S., U.K. and French officials have visited Russia to discuss the Iran issue. Moreover, STRATFOR sources in Moscow have stated that the West has been much more vocal in the possibilities of Western investment and cash going back into Russia, should Moscow want to be partners with the West.
The continuing effort to get a full accounting of Iran's nuclear program will not to end anytime soon. But if STRATFOR's analysis is right and Russia does shift its role, we could very well see a dramatic change in the tone and pace of the negotiations. The mullah might not like finding themselves alone. (For reference, see Edward Lozansky's post of October 26 on this topic.)
Continue reading "Courting Russia on the Iranian Nuclear Issue? " »
 On Saturday, November 7, Fedor Emelianenko proved one more time that he is the best fighter in the world by knocking out the undefeated Brett Rogers in the second round. For the first time in Russian history, the First Channel (main government TV station) showed an MMA fight, just 12 hours after CBS aired it live in America. As Fedor Emelianenko said in his post-fight interview, he was “more popular in America than in Russia;” his manager added “not anymore.” Russians prefer box to the brutal and bloody Mixed Martial Arts, but Fedor’s victory was impossible to ignore. When asked about the reasons of his victory, Fedor answered: “Millions of Russian Orthodox Christians prayed for me. It is their victory, not mine.”
Brett Rogers, a Chicago native, was the underdog of the fight in his own hometown. Fedor Emelianenko was the celebrity and the favorite of the crowd that came to see the Strikeforce-M1 fight at the Chicago's Sears Centre Arena. My personal experience watching the fight was unique, as I watched the match at a bar in Nashville, TN. Dozens of American Southerners came to a local establishment to support… the Russian! Could one imagine just 20 years ago that a Southern crowd would be cheering to the images of a Russian beating the crap out of an American. Rocky, indeed, is an outdated material. Now, one can only hope that politicians in Moscow and Washington would catch up with the times...
 After the fight, the first people from Fedor’s camp who came out onto the mat were long-bearded Orthodox priests from Fedor’s village. Fedor wrapped himself in a Russian flag and put a giant wooden cross on his neck. My American bartender poured me a free drink to celebrate Fedor’s victory and asked where Fedor was from. I said “from the Russian version of East Tennessee.” The fable-like Russian fighter is a loving father, strong believer, and the most dangerous heavyweight fighter in world history.
Read the ESPN coverage of the fight in the extended post.
Continue reading "Fedor Emelianenko Knocks Out the Undefeated Brett Rogers, Thanks Russian Orthodox for Their Prayers" »
 The murder of Novaya Gazeta’s journalist Anastasiya Baburova and attorney Stanislav Markelov apparently has has been solved. The reputed killers were found and arrested; they are members of the RNU (Russian Nationalistic Union) known in Russia as RNE. While Western media insinuated that the murder that took place on January 19, 2009 was a Russian government attack on the journalists, Muscovites who witnessed the event could tell you exactly the opposite story. The true story less exciting, but and more troubling, than the one about Putin eating liberal journalists for breakfast...
The nationalists assassinated attorney Markelov for his work in defending other victims of nationalistic attacks. When the crime took place in downtown Moscow, Anastasiya Baburova was interviewing the lawyer. She drew attention to the crime scene and started chasing the killers; so they shot her as well. One of the saddest part of this story is the complete misunderstanding of the Russia’s most troubling problem: the Western press continues to paint a portrait of a authoritarian Medvedev/Putin tandem and suggesting that there is a liberal alternative. The truth is, whether one likes Medvedev and Putin or not, the only other viable alternative to their rule--and a quite popular one--is nationalistic fascism. We, at Russia Blog, extend our sympathies to the families of Stanislav and Anastasiya.
Russia is once again outflanking America in the space race -- the space tourist race.
 On November 3, 1957, humans killed their first space tourist. Laika, we at Russia Blog salute you, “Bow-wow old friend, bow-wow.”
While the Russian government looks around for a spare $600 million to build their nuclear wessel by 2021 (hopefully using the Mobile Banka as their prototype), Reuters reports that an upstart Barcelona-based company, Galactic Suite, plans to use Russian rockets and a yet to be named Caribbean island to compete with Virgin Galactic and the New Mexico spaceport:
[Galactic Suite] plans to open the first hotel in space [and] says it is on target to accept its first paying guests in 2012 despite critics questioning the investment and time frame for the multi-billion dollar project. The Barcelona-based architects of The Galactic Suite Space Resort say it will cost 3 million euro ($4.4 million) for a three-night stay at the hotel, with this price including an eight-week training course on a tropical island.
Continue reading "A Kinder, Gentler Cuban Missile Crisis" »
In his recent article, Bruce Chapman—Discovery Institute’s President and former Director of the White House Census Bureau—rightly criticized the Russian government for cancelling the scheduled 2010 Census. (The census was moved to 2013). We want to believe that it was Russia Blog’s criticism that forced prime-minister Vladimir Putin to revisit the issue. The original official reason for the census cancellation was the lack of budget funds. While FSB, among many other government agencies, is using taxpayers’ money to renew its branches’ auto-fleets with brand new bullet-proof Mercedes-Benz’s S 350 L 4Matic (yes, with expensive woods, luxurious leather, hi-end stereos, and iPhone connectors; any U.S. FSB agents want to change their employer?), it was extremely hard to believe that Russian economy was doing that bad. Russia’s Census Bureau (RosStat) was despaired by the cancellation, as they had spent significant funds and effort preparing for the act.
In Russia, criticism of the census cancellation was very muffled, as most Russians sincerely don’t understand its value. Most likely, Medvedev and Putin were not afraid to reveal the information that could be compared to the one of 10 years ago; even with the global financial crisis, it is very hard to beat Russia’s humiliating conditions at the end of Yeltsin’s era. It still remains a secret what exactly moved the Kremlin to cancel the census in the first place. What Russian government most likely hadn’t realized were the potential economic consequences had census been canceled. International corporations use census results for their marketing, expansions, hiring, and other business objectives, and the corporate-oriented Kremlin must have heard that message loud and clear. The census, according to Putin, will take place in 2010, and the Russian government committed the necessary 10.5 billion rubles (360.5 million USD) to finalize the effort.
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