What next for Putin’s Russia?

By Alan Selby

Against a backdrop of growing discontent, and widespread allegations of fraud, Russia’s recent elections heralded Vladimir Putin’s re-election to the presidency. The man who many still saw as Russia’s de facto leader will now resume his tenure, four years after ostensibly ceding power to Dmitry Medvedev. 

In light of these developments a panel of experienced commentators gathered at the Frontline Club to assess the past, present and future of Putin’s Russia. The evening was chaired by Edward Lucas, The Economist’s Deputy International Editor, in discussion with Masha Gessen, a Russian-American journalist and author, and Bill Browder, an outspoken shareholder activist who was the largest foreign investor in Russia until 2005, when he was banned from the country.

Gessen, author of The Man Without a Face: The Unlikely Rise of Vladimir Putin, described Putin’s Russia as a mafia state in which large-scale corruption at the top relies on small-scale corruption at the bottom. She claimed that Putin “thinks the KGB is the best thing that was ever invented”, adding that she saw him as pleonexic – in that he suffers from the insatiable desire to have what rightfully belongs to others.

Browder agreed, describing his own experience as “the story of how bad things have got in Russia, and emblematic of the bare face of Russia from the beginning to the end.” He began to withdraw his money when he realised that all of his companies were hemorrhaging money to corrupt officials. A saga ensued in which Russian police seized his assets, took control of his companies and – amongst other things – conspired to reclaim $230m that Browder’s companies had paid in tax.

What followed has now become an infamous tale of state corruption and brutality. Sergei Magnitsky, the lawyer investigating matters on Browder’s behalf, was imprisoned and eventually murdered in custody. 

His is not the only case of this kind, as Browder and Gessen observed, but the unfailing bureaucracy of all involved led to the publication of an exact account of the events, written by Magnitsky, and a list of those responsible. Lucas described the Magnitsky list as “one of the most effective fires lit under the regime”, and Browder summarised the reasons behind its impact: 

“The people who committed these crimes didn’t do it because of religious intolerance, or ideological intolerance. They did this for money.”

Browder suggested that the regime was unsustainable, given the prevalence of events like this, but the panel recognised the inherent difficulty in ensuring a genuine transition of power. Gessen offered her own analysis of the regime’s ability to adapt and protect itself:

“With the whole reset campaign of the last 3 years, there were a lot of people who fell into Medvedev’s trap. The best way to think of Putin and Medvedev is of a president and a first lady: the first lady gets to reach out to people, and perform humanitarian gestures. That humanitarian gesture deceived a lot of people.”

Despite this, Gessen noted that the West is an important influence, even to the most corrupt Russian officials:

“More important than anything else, it’s the place where they keep their money. You can’t keep your money in Russia, there is always somebody better connected than you are.”

And, as the question and answer period drew to a close, Lucas suggested that Putin’s hold on power might begin to loosen if another disaster on the scale of the Kursk or Beslan were to strike:

“He handles these situations very badly. The people who’ve got a huge stake in the survival of the regime may wonder if they can keep it going for a few more years by pushing him downwards or sideways.”

Watch the event here: