R.Politik CEO and founder, Tatiana Stanovaya, is regularly quoted by major Russian and international media outlets. She is available for commentary in Russian and English.
Every Man for Himself: The Russian Regime Turns On Itself
The Russian regime is less and less like a well-tuned orchestra with a confident conductor, and more and more like a cacophony in which every musician is trying to play louder and get more attention than everyone else. No one is focusing on the harmonious sound of the symphony. Instead, institutional and corporate priorities take precedence over national priorities, and are carried out at the latter’s expense. This political divergence has been provoked by Putin’s political absence, and fueled by a general fear of an uncertain future and lack of clarity regarding Putin’s plans.
Calvey, the founder and CEO of private equity firm Baring Vostok, was practically the main participant of the forum, despite sitting this one out due to being under house arrest. He was discussed by Sberbank CEO German Gref and former finance minister Alexei Kudrin, by current Finance Minister Anton Siluanov and Economic Development Minister Maxim Oreshkin, by Prosecutor General Yury Chaika, and by Putin himself. And during the forum, Calvey was joined as a cause célèbre by the journalist Golunov.
There are three clear positions on the Calvey case. The first is pro-liberal and non-state, and believes that the U.S. investor’s arrest was a powerful blow to Russia’s investment climate. This is the position expressed by business ombudsman Boris Titov and the in-system liberals Kudrin and Gref, and is the position favored by the business and investment community.
The second position is more formal and is represented by state functionaries. Siluanov is clearly weary of the responsibility attributed to him as a representative of power, so has called for less focus on Calvey’s case while emphasizing that there really are “questions” concerning the bank’s activities. Neither Siluanov nor his fellow minister Oreshkin are in a hurry to stand up for Calvey, though they abstractly acknowledge the existence of a “systemic problem” of prosecuting businessmen. It seems that the case against Oreshkin’s predecessor, Alexei Ulyukaev—currently serving an eight-year term for graft in a case instigated by none other than Sechin—has been an effective cautionary tale: publically opposing the siloviki is not now the done thing.
The third position was formulated by Prosecutor General Chaika, who attempted to defend the actions of the siloviki against accusations that they had intervened to help one side in a corporate conflict, saying there were “enough grounds and reasons” to open a criminal case into Calvey.
As for Putin, only one thing was clear from his first detailed public comments on the case: the president himself doesn’t really know to what extent Baring Vostok is guilty of anything, and so prefers to leave it to the supposed professionals.
In this context, the Calvey case looks like a regrettable yet insignificant episode on the periphery of the global war for markets and spheres of influence, in which Putin, as head of a state under attack, is dealing with a completely different scale of tasks. Against the backdrop of these global challenges, the arrests of businessmen and representatives of independent media get a little lost, along with despairing officials who barely believe in the possibility of economic growth in a country that is at war.
Will Facebook and Twitter be next?
Tatiana Stanovaya, the founder of the risk analysis firm R.Politik, said that when it comes to taking on the tech titans, the Kremlin had become hostage to its own policy.
“The Kremlin doesn’t want to ban Facebook. I think there is an understanding that a new generation of Russians has grown up and they live on the internet,” she said. “If they were to block it online it could lead to a revolution.”
The Kremlin is growing nervous over rising public resistance to the Russian president’s long rule.BY AMY MACKINNON
The Russia analyst Tatiana Stanovaya has argued that the Russian system of power is slowly starting to cannibalize itself. A key barometer of this has been the uptick in arrests of former officials and high-profile individuals, including Michael Calvey, a prominent American investor who was arrested this year in the midst of a business dispute.
«La Russie se préparait au scénario selon lequel Porochenko irait jusqu’à tronquer le scrutin pour gagner, ce qui lui permettait de ne pas reconnaître les résultats de l’élection, comme frauduleuse, et de rompre radicalement toutes les relations», analyse la politologue Tatiana Stanovaya, du cabinet d’expertise R.Politik.
Face à la victoire de plus en plus certaine de Zelensky, la Russie garde la même ligne. Si beaucoup d’Ukrainiens le préfèrent au président sortant, car il représente le changement et qu’il ne peut pas être pire que Porochenko, devenu insupportable, au Kremlin on attend de voir. D’autant que le comédien néophyte en politique n’a jamais exposé de programme clair, tout en misant sur une unification de tous les Ukrainiens, par-dessus la fracture traditionnelle Est-Ouest. «Le rapport à Zelensky est ambivalent, poursuit Stanovaya. On ne comprend pas ce qu’il a dans le ventre, son degré d’autonomie, dans quelle mesure il peut s’entendre avec les élites ukrainiennes, quels sont ses projets pour le Donbass, s’il est totalement dépendant de la conjoncture intérieure.»
Tout dépendra donc de la ligne qu’adoptera, s’il est élu, Zelensky. «S’il s’engage à perpétuer la ligne dure de son prédécesseur, en réclamant la Crimée, le Donbass, des compensations, alors la réponse sera dure aussi. Par exemple l’accélération de la distribution de passeports russes aux habitants des régions séparatistes du Donbass», explique Stanovaya. Mais même s’il montre patte blanche et apparaît ouvert à la négociation avec la Russie, jamais il ne pourra mener une politique favorable aux intérêts du Kremlin.
For Moscow, Mr. Zelensky is the more palatable choice given Mr. Poroshenko’s militaristic posture toward Russia, said Tatiana Stanovaya, founder of the political analysis firm R.Politik. “But whatever happens, the Kremlin understands there is no chance an overtly Russia-friendly leader in Ukraine will emerge in the near future,” she wrote in a report to clients this month.
By Tatiana Stanovaya
Abyzov’s arrest demonstrates that the prosecution of economic crimes is becoming chaotic, and that politics, which previously loomed large behind high-profile arrests, now appears only after the fact, as a secondary, albeit important, consequence.
A fascinating tale is unfolding following the high-profile arrest of the once influential Russian politician and businessman Mikhail Abyzov. Abyzov is known for two things. First of all, he was in Prime Minister Dmitry Medvedev’s team, where he headed the somewhat inconspicuous Ministry for Open Government Affairs. He also played a notable role in the electricity sector, working for its reformer Anatoly Chubais and running his own business in the 1990s. Abyzov had moved to Italy, but was arrested by the Federal Security Service (FSB) on a visit to Moscow.
When Medvedev was keeping the presidential seat warm for Vladimir Putin in 2008–2012, Abyzov staked a lot on Medvedev staying on for a second term as president, and in 2011, he contributed a lot to that scenario, including organizing a public committee in support of Medvedev’s reelection.
Medvedev ultimately served just one presidential term before resuming his role as prime minister under Putin, but he did not forget Abyzov’s support, and created a position especially for him. The Ministry for Open Government Affairs was to serve as a platform providing expertise to the cabinet, but after Putin’s return to the presidency, the cabinet lost virtually all its opportunities to display independent initiative. So the Ministry for Open Government Affairs, just like the rest of the cabinet, was essentially paralyzed.
Abyzov had come under fire from various quarters over the years, including from Sberbank head German Gref, who criticized Abyzov in 2013 for his subpar performance, and from Abyzov’s former boss Chubais. In 2018, the Ministry for Open Government Affairs was liquidated, and the former minister settled outside the country.
Medvedev’s former cabinet minister hasn’t attracted much sympathy from the in-system liberals who were outraged by the arrests of former Kirov region governor Nikita Belykh, former economic development minister Alexei Ulyukayev, and the American investor Michael Calvey. Nor is the liberal opposition crying foul: in fact, Abyzov’s arrest is a rare case of FSB actions finding some understanding among Putin’s critics. Anti-corruption crusader and opposition figurehead Alexei Navalny, who published a report into Abyzov’s abuses of power two years ago, says that the government copied its investigation from him.
Since Abyzov clearly generates little sympathy from any corner of the Russian elite, it’s hard to detect political intrigue in his case.
Nor did he fare much better as a businessman. In 2015, he sold his virtually bankrupt engineering company E4 Group to its creditors, who had demanded the repayment of its debt and threatened criminal prosecution. Alfa Bank accused Abyzov of using his public service position to run his business. In March this year, Alfa Bank again asked Abyzov and his partners to pay 33 billion rubles ($500 million).
The current charges publicized by the Investigative Committee relate to the sale of four energy companies. According to Kommersant newspaper, Abyzov’s businesses sold them for 4 billion rubles, while their real value was only 186 million. So there was no shortage of people in the business community who had a gripe with him.
On the surface, Abyzov’s case reveals purely corporate conflicts, wrangling over debts, and using the powerful security services to settle old scores. This may seem like standard practice for Russia, but this time we are talking about a member of the political elite, a former minister, who is likely to know a lot about the shady dealings of some still very powerful figures.
All the differences aside, there is some similarity with the Calvey case: in both cases, the security services have got involved in corporate disputes that have no clear political underpinnings, and have done so without a signal from the president or one of his friends. Only later have these cases taken on a political aspect. Attempts have been made to accuse Calvey of financing the opposition, and a similar accusation may surface in the Abyzov case. Social media and Telegram channels are already rife with detailed stories of Abyzov’s opposition to Putin in 2011, his financial support of the Dozhd opposition television channel, and U.S. citizenship he obtained for his children while living a life of luxury in decadent Europe. All of the above make him an ideal enemy of Putin’s state.
Injecting politics into private disputes may be attributed to the fact that the FSB still has to align itself with Putin, regardless of the personal conflicts it’s called on to resolve—especially if they involve a former minister and a conspicuous representative of the Medvedev government.
The case could be politicized using the well-known template of “patriots against the sellout liberals”: national conservatives detest the in-system liberals and see them as a fifth column and the weakest link in Putin’s system. Suffice to say that Abyzov is accused of creating a criminal enterprise whose members “jeopardized the sustainable economic development and energy security of several regions of the country,” which is punishable by up to twenty years in prison.
The accusations date back to the time when Abyzov served in Medvedev’s cabinet, which inevitably casts a pall over the prime minister himself. The same goes for the circumstances of Abyzov’s arrest. It’s possible that the former minister was invited to return to Moscow by people he believed to be his political protectors. Abyzov was likely in the Russian capital to attend the birthday celebrations of former deputy prime minister Arkady Dvorkovich, who used to supervise Abyzov’s work in the cabinet.
Dvorkovich is one of the weakest figures in Medvedev’s entourage, but also one of the closest to the prime minister. He makes Medvedev extremely vulnerable, which many in the security services have been trying to exploit.
Medvedev’s circle has suffered so many other blows recently—such as the arrest last year of the wealthy Magomedov brothers, who were close to both the prime minister and Dvorkovich—that they are starting to resemble another stage of Medvedev’s decline. The first was in 2011–2013, when the revanche-minded elite managed to undo almost all of Medvedev’s presidential initiatives. That wave had begun to die down by the end of 2013, when Putin was forced to choose between getting rid of Medvedev or stopping the nationwide humiliation of his former heir by taking him under his wing. He chose the latter, and from 2014, criticism of the Medvedev cabinet waned, and Putin more or less aligned himself with the cabinet.
The current wave targets those working for Medvedev, rather than Medvedev himself. It seems that the security services realize that only the former heir is off limits, and everything around him is fertile ground for asserting ambition and instilling order. While the Magomedov case involved conflicts connected to the security services, Abyzov owed too much to those who are not prepared to forgive debt to those enjoying life abroad while they’re forced to live in a “besieged fortress.”
But Abyzov’s arrest is also important because it demonstrates that the security structures are gradually switching from selective to random persecution. And everyone knows that they collect compromising material on any government official and influential businessman. Prosecution for economic crimes is becoming chaotic, and politics, which previously loomed large behind high-profile arrests, now appears only after the fact, as a secondary, albeit important, consequence.
Last week’s arrest of former Khabarovsk governor Viktor Ishayev is a sign that the Kremlin is losing influence over the provinces.
The well-publicized arrest of ex-minister Mikhail Abyzov was followed just two days later by a scandalous new arrest on March 28 — this time of the former Khabarovsk governor Viktor Ishayev.
Unlike the situation with Abyzov, everything seems more transparent in Ishayev’s case. Being an important and long-standing politician, who was in charge of Khabarovsk for 18 years (from 1991 to 2009), Ishayev had a long-running conflict with his successor local governor Vyacheslav Shport.
In the last — extremely difficult for the Kremlin — gubernatorial elections, Ishayev backed a candidate outside of the ruling United Russia party, namely the far-right Liberal Democratic Party of Russia (LDPR) party candidate Sergei Furgal, who ultimately not only won but started to appoint people from Ishayev’s team to key posts in the regional administration.
The Kremlin, it appears, had other plans: searches are now being carried out in the offices of the regional administration, fulfilled by Ishayev’speople.
Furgal remained an undesirable candidate for the Kremlin which prompted the siloviki to investigate all major activities linked to Furgal’s supporters, including Ishayev.
Two major episodes linked to Ishayev were found — fraudulent activity in the Khabarovsk forestry sector and real estate machinations concerning Rosneft real estate in Khabarovsk.
Rosneft opted to head the investigation into Ishayev’s work at the company, which he oversaw from 2013 to 2018 as an advisor to Sechin. In other words, Rosneft had to find a way to protect itself from probable political conflict between the Kremlin and Ishayev/Furgal in a way which would not blow the company’s reputation.
While one sector within the Kremlin hopes to put Ishayev behind bars in order to pressure Furgal, Sechin seems to want to take it easy on him, thereby minimizing his own guilt as Ishayev’s schemes happened under his watch.
Maybe that’s why Ishayev was put under home detention avoiding pre-detention prison.
Abyzov, having had a lot of guarantors in the past could not avoid ending up in a cell, as Dmitry Medvedev these days has very limited political influence.
Furgal’s case is a rift typical of regional elites, the kind of squabble the Kremlin was previously relatively effective in stopping thanks to the strength of the ruling party United Russia. Local elite groups would frequently diversify their political investments by supporting the systemic opposition, though this principally concerned the legislative branch.
Anybody backing another candidate against a favorite would normally have the sole aim of strengthening their position for subsequent bargaining, but with United Russia ratings falling this now presents the opportunity for outright victory — made clear by a number of recent gubernatorial campaigns
But this is not limited to one part of the country: it is a new trend in many Russian regions, as a more recent episode in the Irkutsk region proves. Housewife Anna Shchekina was elected mayor of the city of Ust-Ilimsk after running on an LDPR ticket with the support of ex-mayor Anatoly Dubas, a deputy in the regional assembly.
This is a fascinating trend: while previously high-profile regional actors fought to first talk to United Russia, only then turning to the opposition, the situation has now been completely reversed: an investment in the Communist Party or LDPR can bring outright victory over the authorities’ favored candidate, which drastically increases the prospects of opponents of United Russia and creates far better conditions for the defeat of Kremlin candidates at all levels of future regional elections.
An investment in a candidate from the Communist Party or LDPR can bring victory over the authorities’ favored candidate.
The problem is aggravated by the approach of those currently responsible for shaping internal politics: not only is work on incorporating the systemic opposition into the “vertical” not being done, but this is not recognized as harmful.
Instead of working to strengthen the position of the ruling party, the Kremlin is focusing on engineering victories for specific candidates, which is eroding the regime’s institutional foundation.
This is leading to the appearance of a growing army of figures who are unhappy about the new political trends. These include extremely influential players such as Igor Sechin or Russian Defense Minister Sergei Shoigu (who, for example, supported Viktor Zimin’s ill-fated bid for re-election as governor in Khakassia last fall).
In other words, Shport’s defeat in Khabarovsk is becoming not only a failure for the Kremlin, but a headache for influential groups with an interest in the region, who are now being forced to protect their interests with whatever means they have at their disposal.
It is not Sechin’s aim to sow discord between new and former governors of the Khabarovsk Territory, but if a problem appears, it’s simpler to solve it using tried and tested methods with the help of the siloviki — officials with ties to law enforcement.
This is the reason for the increasingly chaotic functioning of administrative and power resources, in which each player takes what they need from the state in order to solve their corporate or political problems.
Abyzov’s arrest is irrefutable confirmation of this. The former minister, who was being hunted down by creditors, was arrested over a dubious corporate deal that the FSB is now trying, post factum, to turn into a serious political investigation. Abyzov is now being painted as the organizer of a criminal group that is threatening the “economic development and energy security of several regions.”
The Federation Council and the State Duma, regional governors and legislative bodies, as well as the mayors of major cities, were built into a single, unofficial vertical. The siloviki constructed the vertical without higher political permission and didn’t touch politicians and officials.
Little now remains of this ideal system. Nobody can get through to Putin, and everyone is now on their own: the systemic opposition can be used in order to remove an inept governor, and the FSB to jail a debtor or take revenge for disloyalty.
The number of imprisonments will snowball in the very near future, touching even the highest-ranking officials. A struggle for survival is beginning to emerge.
And crucially, there is no longer a way back to the stability of the 2000s, nor the vertical, leaving Putin with only local manual control — when he is not occupied with geopolitics.
The logic of political processes in Russia has changed, with the motto “that which is not permitted is forbidden” replaced by a new one: “that which is not forbidden is permitted.”
For Russia, the main consequence of annexing Crimea has been the gradual decline of Putin as the country’s domestic leader.
By Tatiana Stanovaya
Five years after Russia’s annexation of Crimea, experts are producing detailed analyses of how the annexation changed Russia and its society.
The country has undoubtedly changed — but no less important is the change Vladimir Putin himself has undergone.
He experienced two crucial jolts to his psyche — the first when he grabbed back power from Medvedev, who was dreaming of a second term as president, and the second when he decided — somewhat unexpectedly, even to himself — to annex Crimea.
Over the past five years, a new political leader has emerged — one who has little in common with the Putin the country had known and loved. Russia may have taken over Crimea, but Crimea, in turn, appears to have swallowed up Putin.
The fact that Vladimir Putin’s regime was based on his own high ratings was no secret: This was a key element of the entire political system.
Putin was essentially able to construct his power vertical on the basis of a direct contract between authority and society, emasculating the Russian elite and prioritizing the state control and repression apparatus above all other political actors, oligarchs, regional elites and political parties.
If by 2008, this construction had reached its peak, it was severely tested during Dmitry Medvedev’s presidency. The worst came in 2013, when Putin’s ratings plummeted to their lowest yet, the economy stuttered and positive trends were noticeably absent.
That year saw the first signs of the regime’s erosion and political depression. The Crimean annexation turned this around, appearing to bring precisely the things that significant swathes of the population expected from their leader: determination, historical justice and national pride. The country had, once again, found its hero.
Soaring post-Crimea approval ratings and the paralysis and eventual collapse of the liberal opposition, however, brought with them their own political dangers.
Putin began to lose touch with the mood in society. The “return” of Crimea created the illusion of indulgence, a carte blanche for the most ambitious geopolitical projects. With time, however, it became apparent that the president represents not his electorate, but a state of his own imagination. After 2014, Putin’s regime began to evolve into something entirely different.
The annexation of Crimea was the first significant foreign policy initiative undertaken without regard for Western reaction. This new approach soon manifested in the Donbass and Syria conflicts, as well as in Russia’s information and cyber policy toward Western countries.
If during his first two terms Putin was motivated primarily with reviving the country by domestic development, after Crimea, he adopted an entirely new mission in no way linked with his country’s social and economic needs. Putin’s course and focus as president subsequently took on a life of its own, at direct odds with the wants of the people.
With his continuing focus on foreign policy, the president moved away from his own political elite, resulting not just in an increasingly detached president, but also a power vacuum within the vertical.
This has resulted in fierce infighting among the elite, as the high-profile arrests of former Economic Development Minister Alexei Ulyukayev and senator Rauf Arashukov demonstrated. Here too, we see signs of Putin’s weakness as a political leader.
For Russia, the main consequence of annexing Crimea has been the gradual shriveling of Putin as the country’s domestic leader.
A tightly coiled political vacuum has formed, and it is closely guarded against alternative elements. Vladislav Surkov’s notorious open letter sums it up well: never before has anyone described the lack of ideas and cynicism of Putin’s new Russia with such candor.
The annexation of Crimea allowed the president to cast Russian society as a silent, helpless, impotent mass, forever in debt to the president for bringing the peninsula “home.” Russian society, however, is starting to show that it never signed up for these terms.