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Thursday, December 13, 2007

Latynina on Medvedev

Writing in the Moscow Times, hero journalist Yulia Latynina comments on the results of this week's Russian presidential election:

Russia's presidential election was held Monday. President Vladimir Putin voted for First Deputy Prime Minister Dmitry Medvedev to become the new president.

Why did the president wait so long in announcing his decision?

Over the course of Putin's two terms in office, we have seen how he has strengthened presidential authority. At the same time, the independence of governors, the Prosecutor General's Office, the courts and the State Duma have all been significantly weakened, if not eliminated entirely. Moreover, uncooperative oligarchs were imprisoned or driven out of the country, while the more cooperative oligarchs were strong-armed into making deals with the president. The presidential post has become Aladdin's lamp: If you rub it, your wish will be granted.

Putin had two strategies to preserve his authority. One was to change the Constitution to permit a third term. The other was to name a successor who would be completely subservient to his control. According to the second strategy, his successor holds Aladdin's lamp, gives it a rub, and the genie pops out and asks, "What is your wish, master?" The new president responds, "I don't know -- ask Putin what he wants."

It's clear this system would not hold up for long, because even the most timid and obedient successor would quickly figure out that the privileges that come with the lamp are now his to enjoy exclusively.

This is not a question of politics, but of psychology. How long will it take Medvedev to realize that he really isn't bound to Putin? Considering, however, that Medvedev has never been known for his audacity or decisiveness, he probably won't be feeling independent too quickly.

The fact that Medvedev is in charge of the national projects, including health care and education, is a big asset for the president, but if Medvedev were actually successful in implementing these huge projects, this would then become a liability because the young protege's authority would be strengthened along with his success. In his capacity as head of the national projects, Medvedev has access to huge sums of money, administrative resources and a personal mandate from the president. Therefore, Putin's best bet is to make sure that his president-to-be is bogged down in the national projects. In this way, once Aladdin's lamp is handed over to Medvedev, it would just sit in the corner gathering dust, and this would leave Putin free to keep the genie firmly on a leash.

But there is another, purely economic reason why Putin hesitated in naming a successor. To a large extent, control of the economy is concentrated in the hands of Putin's friends. For example, following the dismantling of Yukos, most of its oil is now exported through the foreign trading company Gunvor, which was co-founded by Gennady Timchenko, a close friend of Putin's. Gunvor is earning astronomical profits as a result, and its capitalization is nearly $20 billion.

But when Putin leaves his presidential post in May, it is very possible that Timchenko and all of the other people Putin helped strike it rich will no longer feel the need to be subservient to him.

Considering Medvedev's docile character, Putin's choice lowers his political risk to a minimum, but the economic risks of such a move are extremely high.

There will be no need for Medvedev to take due ownership of Aladdin's lamp and to turn on the person who gave it to him. To fill Putin's spot, he needs do nothing more than wait until Putin's friends, who became billionaires through his help, quickly ignore Putin's orders and even stop answering his calls.

Will Medvedev ever betray Putin? The answer is no. Medvedev will never get to him in time because Putin's friends will devour him so quickly that nothing will be left for Medvedev to even pick at.

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