A really brilliant piece in the Telegraph explains the horror of watching a shadow fall, once again, across the whole of neo-Soviet Russia. It's gratifying to see the world finally catching up with this blog. We're becoming conventional wisdom! Note that even this great piece doesn't go far enough: The author (the Telegraph's executive editor) states: "The notion that Russia under Putin could return to the worst excesses of Comrade Stalin is, of course, far-fetched." What he's forgotten is that the reality he documents today seemed very "far-fetched" indeed just a few years ago (when we predicted it, many called us chicken-little crackpots!). We all must confront the demons of our psychological defense mechanisms, which make it very hard for us to accept the stark terror of certain facts. If things are this bad now, when Putin has an iron grip on power and oil prices are high, what might happen in Russia when that's no longer the case? It's a theme that runs through Russian history: After all, how many thought the Bolsheviks could take power from the Tsar? How many saw the full horror of Stalin before it was too late?

Darkness is falling in Vladimir Putin's Russia

Soaring oil prices have made the country a power again - but its ruler's grip on politics, the media and economy has sinister implications for democracy. Con Coughlin reports from Moscow.

Standing in the shadow of the Lubyanka, the notorious former KGB headquarters in central Moscow, a small group of elderly women are gathered around a large slab of granite that commemorates one of the darkest episodes in Russia's history. The slab was taken from one of the Solovetsky punishment camps near Archangel on the White Sea, which formed what the Russian writer Alexander Solzhenitsyn described as the Gulag Archipelago, where the victims of Stalin's terror were sent to their deaths in their tens of thousands. It has been placed outside the Lubyanka as a memorial to the millions of victims of state persecution and repression during the Soviet era. A neighbouring monument to Feliks Dzerzhinsky, the Bolshevik founder of the KGB, was unceremoniously torn down by an angry crowd of Muscovites shortly after the collapse of the Soviet Union in the 1990s: all that now remains is a well-cut grass mound.

Wearing faded headscarves and threadbare coats to protect themselves from the bitter cold, the frail old ladies - some of them in their nineties - quietly intone their prayers for the dead, before placing small, neatly bound clusters of flowers around the granite slab. "I'm still trying to find out what really happened to my grandfather," says Lyudmila, an 82-year-old grandmother who has travelled 500 miles to Moscow to mark Russia's official Memorial Day for Political Prisoners. "They wanted him to work for the KGB, but when he refused they sent him off to the Gulags. He died of starvation, but apart from that we know very little."

Russian experts estimate that seven million people perished in the Gulags, and ordinary families are still struggling to come to terms with the horrors they suffered under the Soviet era. Even Russian president Vladimir Putin, a former senior KGB officer, appears to understand the necessity of acknowledging the appalling repression of the Soviet era. Later in the day he would make his first visit to a memorial and church built at a site on the outskirts of Moscow where thousands of people were executed by firing squad.

This year is the 70th anniversary of Stalin's Great Terror. It is also an election year in Moscow, and ever-eager to consolidate his popularity (Putin has an 80 per cent approval rating), the Russian leader paid a fulsome tribute to the millions of victims. "As a rule these were people with their own opinions," said Putin. "These were people who were not afraid to speak their mind. They were the most capable people. They were the pride of the nation. And, of course, over many years we still remember this tragedy. We need to do a great deal to ensure that this is never forgotten." The implication, of course, was that nothing like this could happen in Putin's Russia, a truly democratic state where the rule of law is supreme.

Well, tell that to Mikhail Khordokovsky, the former oil tycoon who only six years ago had a personal fortune worth an estimated $10 billion (£4.8 billion). But then he made the cardinal error of publicly criticising Putin's decidedly autocratic style of government. He now spends his days breaking rocks at a remote Siberian penal colony, where he is halfway through an eight-year jail term on what many of his supporters believe are politically motivated fraud charges.

The notion that Russia under Putin could return to the worst excesses of Comrade Stalin is, of course, far-fetched. For a start, the Communist ideology that inspired the Bolsheviks to launch their class war against the governing and professional classes lies buried under the rubble of the Iron Curtain, so much so that the Communists will hardly feature in next month's parliamentary elections, which will in turn set the tone for next year's presidential election. These days, Russian politics is all about the exercise of raw power and the accumulation of vast wealth. For some, like the closely-knit group of former KGB officers around Putin - the siloviki - it is possible to acquire both.

Putin is claimed by some to have a personal fortune in offshore bank accounts in Liechtenstein and Luxembourg, while establishing an authoritarian regime that has established a stranglehold over all the key levers of power. "To talk about democracy in Russia today is utterly ridiculous," explains Stanislav Belkovsky, a leading Kremlinologist whose new book, Putin's Business, provides a detailed breakdown of the Russian president's private wealth. "Putin is one of the wealthiest men in Europe because his business partners are running a network of companies while he runs Russia. So many people want to get their hands on the country's wealth that they are prepared to do anything not to upset Putin. It's a very effective control mechanism."

The recent turnaround in the country's economic fortunes is almost entirely to do with spiralling oil prices, which have recently risen above $90 a barrel over fears that America is shaping up for a military confrontation with Iran, a conflict Russia is anxious to avoid. But if Moscow is unhappy with the Bush administration's warlike disposition, it is nevertheless happy to reap the riches brought by the rocketing price of oil. It might seem hard to believe now, but when Putin came to power eight years ago, Russia was an economic basket case. Boris Yeltsin's chaotic presidency had left the country virtually bankrupt. The debt default of 1998 had resulted in millions of Russians losing their jobs and savings, and pensioners, servicemen, teachers and scientists all went unpaid. This was a period when it was not uncommon to find that the bellhop at one of Moscow's new, Western-financed hotels had a PhD in nuclear physics. Today, Russia has the world's third-largest currency reserves, standing at £200 billion, mainly as a result of Putin's brutal repossession of the country's main energy companies from the oligarchs who had bought them cheaply during the 1990s and made themselves vast personal fortunes. That wealth is channelled into propping up Putin's regime, and while beyond Moscow there are still large swathes of the country where poverty is rife and the population survives on a subsistence diet, in the capital it is clear that life for Putin's supporters has never been better.

Moscow must rate as the world capital for conspicuous consumption. It is said there are more Bentleys per capita than anywhere else in the world, and boutique stores selling leading luxury brands, from Cartier to Chanel, struggle to meet the demand generated by the city's new super-rich. Nor has the new oil wealth only been concentrated in the hands of the chosen few. There has been a tenfold increase in the national budget in the past seven years, and there is a palpable sense of prosperity and self-confidence running through the rapidly emerging professional classes. But even if the economic feel-good factor is starting to trickle down from Putin's elite to other sectors of society, the Russian people have paid a heavy price for their new-found prosperity, both in terms of the erosion of their political rights and the effective suspension of the rule of law.

[LR: It's not hard to understand why Russia's level of consumption is so conspicuous. First, just as in the Soviet and Tsarist times, the tiny elite with money knows they won't be able to keep it for long, so why not enjoy it while you can? Second, now as then, this tiny group simply couldn't care less about the vast majority of their countrymen, who continue to suffer the torture of poverty, short lifespans, alcoholic degradation and the squalor of pollution, disease and the total lack of hope for a different future. In other words, those who cannot remember history are doomed to repeat it.]

The parliamentary elections will take place on December 2, but the result is a foregone conclusion. Putin's United Russia party will win 80 per cent of the vote and form the a government for the next four years. It will then be for them to decide whether Putin should change the constitution to allow him to stand for a third term in next spring's presidential elections. "It's a bit like going to a football match, and when you arrive at the stadium the score has already been decided without the teams even having to take to the pitch," explains Grigory Yavlinsky, the leader of Yabloko (Apple), one of the few truly independent political parties still participating in the election campaign. "Putin has the system so closely controlled that he is able to arrange the result of a so-called democratic election weeks before that election has even taken place."

Yavlinsky knows all about Putin's political skills, having stood against him in the last presidential election four years ago. Yavlinsky's small grass-roots organisation was no match for Putin's KGB organisational skills. The president's supporters ensured that Yavlinsky's party won less than five per cent of the national vote, which meant that it could not even be represented in the Duma. "It was very strange how we would win thousands of votes in the provinces, but when they came to be counted in Moscow they had somehow been reduced to just a few hundred," says Yavlinsky. "No wonder no one stands a chance of defeating Putin in the coming elections."

Electoral fraud is allegedly just one of many ways the United Russia party keeps its stranglehold over the state. On election day there are an estimated 98,000 polling booths, and even though some are monitored by independent observers, it is impossible to keep a check on all the different votes, which are eventually sent to Moscow, where the electoral commission, supervised by political appointees, announces the result.

Another effective control mechanism is that the Kremlin dictates access to state funding for political parties, and also how much airtime they have on state-controlled television and coverage in the main state-controlled newspapers. In order to get funds and media exposure, a party must give the Kremlin a firm assurance that it will not discuss controversial issues, such as state corruption, or the way the ruling elite uses the courts to intimidate its opponents. Once that assurance is forthcoming, the party will receive money for its campaign and its candidates will be allowed to appear on television. But even then opposition parties are only allowed on television for the month-long election campaign. For the rest of the time, the Kremlin keeps a tight rein on who gets on television, with producers being given regularly updated lists of who can appear.

The result is that on most nights, the main news topic is a eulogistic account of Putin's latest activities, whether that be posing semi-naked on a fishing expedition or travelling to Teheran to lecture the Americans on the futility of launching military action against Iran. With coverage like this, it is hardly surprising that Putin's approval rating rarely dips below the 80 per cent mark. As a former KGB officer under the Soviet system, Putin understands the value of propaganda in indoctrinating the populace, and the stranglehold he has over the media is equal to the control he exercises over the economy. Economic prosperity and rigorous media control are a potent mix when it comes to keeping a firm grip on power, and Putin has demonstrated an aptitude for maintaining both.

There is, though, a dark underbelly to this resurgent Russian bear which, despite the formidable powers at its disposal, remains highly sensitive to criticism, whether from home or abroad.

The BBC's Russian FM service recently disappeared from the airwaves after it ran a series of interviews with disaffected Russians who dared to voice their criticism's of Putin's Russia. And far worse fates have befallen those, such as the journalist Anna Politkovskaya, who have managed to evade the stranglehold the government has on media outlets to publish highly critical articles on the regime's conduct. It is just over a year since Politkovskaya was found dead at the bottom of a Moscow lift shaft with three bullets pumped into her skull. The official investigation into her death - carried out by yet another Putin associate - has produced an interesting insight into how the regime's critics are silenced. Politkovskaya was as much a critic of Putin's authoritarianism as she was of Moscow's disastrous involvement in Chechnya. Shortly before her death, she wrote of his regime: "The shroud of darkness from which we spent several Soviet decades trying to free ourselves is enveloping us again." But it was her trenchant criticism of the conduct of Moscow's military campaign in Chechnya that provoked most controversy, and it now seems likely that a group of Chechen warlords loyal to the Kremlin contracted a gang of Moscow street criminals to murder her.

The poisoning of Alexander Litvinenko in London last year was seen by many as another example of Moscow's heavy-handed response to high-profile critics. But the state repression is more reminiscent of the paranoia that characterised the Brezhnev era in the 1970s, when refuseniks were carted off to lunatic asylums, rather than the widespread killing during Stalin's Great Terror. Indeed, there have recently been reports that some prominent critics of the regime have also found themselves being committed to the state's psychiatric care, although, to date, these have been rare instances and there is no evidence to suggest the practice is widespread.

What is not in any doubt, however, is that Putin is the undisputed master of all he surveys in Russia. The big question now is whether he can summon the courage to give up all the power he has so carefully accumulated over the past eight years. Under the current constitution, Putin is obliged to leave office next spring after two full presidential terms. It has been suggested that he might be prepared to take the more junior position of prime minister in the Russian parliament, so long as he can manoeuvre one his key allies into the presidency. Alternatively, he could get himself appointed to the energy giant Gazprom, and add to the considerable fortune he has accumulated as president.

But for these scenarios to work, Putin would ultimately have to answer to the new Russian president - and Putin has not been good at taking orders since he worked at the KGB. Which is why most Russians believe that, once United Russia has secured its predicted two thirds parliamentary majority, it will move quickly to amend the constitution to allow their president to serve a third term. So far as Putin is concerned, when it comes to being President of Russia, you can't get enough of a good thing.