Thursday, April 23, 2020

Current Crises Only Exacerbate Underlying Problems with Putin Model, Kalashnikov Says

Paul Goble

            Staunton, April 21 – The Putin regime appears to believe that its current problems are the result of the combination of falling oil prices, the pandemic, and the global recession; but in fact, that trifecta did not create the problems of “the Putin model.” It only exacerbated them and highlights the need for fundamental change, Maksim Kalashnikov says.

            Putin has postponed the May 9 Victory Parade, the Moscow commentator writes in the influential Voyenno-Promyshleny Kuryer; but he hasn’t been able to do anything about “another parade, that of government disorganization,” confusion and collapse not only in the economy but across the board (

            The Kremlin has comforted itself with the notion that the three developments originating abroad are the source of its problems and failed to recognize that the problems have arisen because of “the Putin model” which is based on a failure to re-industrialize the country, reliance exclusively on the export of raw materials, and the importation of high technology.

            This model is failing before our eyes, Kalashnikov says, even though the epidemiological situation in Russia is “much better than in the US. The collapse is coming in the model’s weakest link, the economy,” and the strategy Moscow has adopted to cope with the pandemic, one copied with delays from the West, will only accelerate this process.

            The cheap credit the regime is finally extending to businesses should have been extended to the economy as a whole long ago, with the proviso that the money go to creating new jobs at home rather than being used to purchase goods abroad. And that should have been strengthened by a tough protectionist tariff policy.

            Instead, the regime has been raising taxes on business and the population, “condemning them to stagnation and poverty,” Kalashnikov continues. “The virus has only accelerated the process of economy’s catastrophe which was generated not by it but the existing [Putin] model. The very same thing can be said about ‘the optimization’ of health care and much else.”

            The Russian government hasn’t thought how it will restore consumer demand and it isn’t giving businesses enough to ensure that jobs will survive. That is, it has followed the West but tried to do it on the cheap, guaranteeing that the Russian approach will fail and Russia will fall further behind.

            What is happening in the economy and elsewhere reflects the shortcomings of a Russian elite that got used to living with high oil prices. As a result, its members aren’t prepared to face reality and to make sensible decisions. Instead, they take actions that are counterproductive like the introduction of passes with the police keeping people together to check them.

            There is no question that “the current coronavirus shock is unprecedented in modern history. It is posing a severe test and not only for the Russian Federation. Usually it is compared with a war” or the depression. But the differences are significant: then, people were out of work ,but they weren’t confined to their homes. They still must eat but aren’t producing anything.

            The Putin model doesn’t address any of the problems; it only makes them worse, Kalashnikov says. “Therefore, this is the choice today: between a conscious reconstruction of the administration and economy of Russia and a simple collapse” into a new “time of troubles” for the country.

            “Extending the senseless regime of ‘self-isolation’ (instead of a lawful quarantine and extraordinary situation) will lead to economic collapse. After that will follow a political one, fully Gorbachevian in its dimensions and consequences. Only a decisive shift to a new course, to industrialization and wise protectionism can save the situation.”

            According to Kalashnikov, “the choice is the Kremlin’s. To live as before is already impossible, and the new cold war isn’t ending.”

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