As the Putin regime continues its crackdown on the growing opposition movement, a former KGB comrade of the president is now in trouble, with his family business “all but ruined by a blizzard of state inspections,” writes Fred Weir in the Christian Science Monitor.
Gennady Gudkov, a businessman and member of the “loyal opposition” in the Duma has been speaking at recent protests in the capital, hoping, as Weir reports, “to steer the protesters toward peaceful and constructive engagement with the authorities.”
But the Kremlin doesn’t see it that way. Russian bureaucrats have targeted his security firm, which has recently been visited by the police, fire department and the Moscow architectural control committee, leading to the suspension of its license for employees to carry guns and forcing him to sell his company at a loss.
“I took the path of Khodorkovsky,” Gudkov said, “and now I am really afraid.”
Read more here.
Bloomberg reports that Russia’s commissioner for business rights believes freeing Mikhail Khodorkovsky as part of an amnesty program for people convicted of economic crimes would send a positive signal to investors.
Boris Titov, interviewed at last week’s St. Petersburg International Economic Forum , said he will proposed that President Putin grant amnesty to some 13,000 people jailed for economic crimes, including Khodorkovsky:
For the investment climate, [releasing Khodorkovsky] would be good news. This should be just and the right decision. [Khodorkovsky] has been in prison too long. He did something, others also did, but nobody else is serving such a sentence.
While it’s doubtful that Titov’s views will come to fruition any time soon, the fact that he is pledging to improve the way the state handles economic crimes is a positive sign.
This one is bad for the economy and bad for freedom.
Just in time for Tuesday’s mass opposition protests that coincide with the annual Russia Day holiday, Vladimir Putin has approved a new law that increases the maximum fines for protest-related offenses to up to 300,000 rubles ($9,200). (Over the weekend a number of opposition leaders had their houses raided.)
In addition to raising the fines for private citizens almost 100 times what they were, the legislation also allows judges to sentence protesters to up to 200 hours of community service, bars protesters from wearing masks and forbids anyone with a criminal record from organizing a demonstration.
Despite admonitions from the Kremlin’s Presidential Council on Human Rights and the Parliamentary Assembly of the Council of Europe to veto the law, Putin demurred, saying it does not violate European norms.
No matter, says the opposition. Thousands of protesters are still planning on demonstrating Tuesday.
The Center for Strategic Studies in Moscow reports that Vladimir Putin is facing discrete political and economic risks due to Eurozone turmoil.
Greece leaving the euro could trigger a global crisis that would drop the price of oil, writes institute chief Mikhail Dmitriev, meaning a worsened Russian economy. That could lead to increased anti-Putin sentiment and more political repression.
Ksenia Yudaeva, chief economist at Sberbank, the country’s biggest lender, said Russia’s economy could contract 2.1 percent, with $95 billion in capital leaving the country in a year, should the euro start to crumble.
“This [departing] capital,” added Dmitriev in Bloomberg News, “is flying into the epicenter of the global financial crisis, which is in Europe. That is actually the same as creating a food supply in the center of an atomic explosion.”
Bank of America sees Russian oil dropping to $60-$80 should Greece and other nations leave the Eurozone. Russian oil prices need to stay around $127 per barrel for the government to balance the budget this year.
Read more about the study in Bloomberg News.
Putin meets with his cabinet
Russian President Vladimir Putin announced his cabinet appointments earlier this week. Some Kremlin observers were hoping that a number of new faces would signal the chance for much-needed reform; instead, many of Putin’s closest key allies, the New York Times reports, are ”poised to preserve their clout.”
The few new names are career bureaucrats with ties to Putin, and none of the opposition leaders who emerged in the last six months of demonstrations was tapped for a government post. According to Dmitri Trenin of the Carnegie Moscow Center:
This is not a new force that has arrived on the Russian political scene; this is a rearrangement of personnel to preserve the power exercised by the various clans. It is more clear than ever that much of the power will be transferred to the Kremlin, and the government [i.e., the Duma] will be a tool of the all-powerful Kremlin.
Former Finance Minister Alexei Kudrin added, “It is not a breakthrough government. I have serious doubts that it will be able to cope with all the challenges that face Russia today.” More on the Russian cabinet here.
In a piece published in TIME magazine in time for Vladimir Putin’s inauguration, jailed former Yukos chief Mikhail Khodorkovsky writes about the lack of rule of law in Russia and how individuals looking for justice there can’t count on the judicial system, which remains under Putin’s influence.
“Perhaps an individual judge may be biased,” he writes,
but the judicial system as a whole can’t ignore both the law and self-evident facts. Therein lies the error in my reasoning. [...] The main feature of the Putin regime, though, is its deceitfulness—from the very top, all the way down. Corruption, stealing from the treasury, persecution of political opponents—all these are consequences of the deep immorality of this government, a government that is more comfortable with smears and evasions than with transparency.
Khodorkovsky closes by saying that more and more, the Russian people are standing up to the regime and that this disobedience will soon bear fruit:
For the [younger generation's] sake, we are beginning to stand taller at last. We are beginning to stand taller in the deceitful courts and on the streets of our cities. Yes, we are still afraid, but now, even more than that, we’re ashamed in the presence of our children. And we can’t be made to bend anymore.
Read Khodorkovsky’s full column here.
ExxonMobil CEO Rex Tillerson (left) and Russian Prime Minister Putin (GETTY IMAGES)
Pavel Ivlev, founder and chairman of Committee for Russian Economic Freedom, released the following statement today on the Exxon-Rosneft alliance:
Through today’s agreement with Exxon, Rosneft has finally managed to give an aura of legitimacy to its theft of assets stolen from Yukos and its shareholders, including hundreds of American investors, as well as its CEO, Mikhail Khodorkovsky, who languishes in a Russian prison for crimes he did not commit.
Perhaps more than any other company, Exxon understands the pitfalls of conducting business in Russia, and while it is willing to assume the risks, the company must also seek opportunities to advocate for the pro-business reforms needed to make Russia a safer, freer place to invest and conduct business.
As it becomes a key partner to a Kremlin-run concern, Exxon can either play a formative role in pushing for much-needed rule of law protections in Russia or it will bear responsibility for abetting the Putin regime as it launders its ill-gotten gains and seeks to expand its personal wealth at the expense of the Russian people.
Russian news agency Interfax reports that the vast majority of Russians believe the amount of corruption in Russia to be excessive, but they also feel that the nation’s leaders cannot or will not do enough to stop it.
Some 81 percent of the respondents to a national poll conducted mid-March said the level of corruption in the country is “high,” up from 75 percent in 2010. Forty-three percent believe corruption cannot be eradicated, as opposed to 39 percent who said it can be eliminated one day.
Meanwhile more than a third (35 percent) of the Russian electorate said they could not judge the work of President Dmitry Medvedev after nearly four years. (Imagine a third of the U.S. population not being able to judge a president’s job after even four months.)
Even more telling, 72 percent of the respondents said they saw no difference between the policies of Medvedev and his presidential predecessor / successor, Vladimir Putin.
Read more about the polls here.
The New York Times reports that President-elect Vladimir Putin needs to pray for higher oil prices if he hopes to pay for his expensive campaign promises that include “raising wages for doctors and teachers, padding retirement checks for everyone and refurbishing Russia’s military arsenal,” not to mention a “baby bonus” that would pay Russian couples up to $8,300 for having a third child.
Citigroup estimates oil would need to reach $150 a barrel, a price it has never reached, and sustain that price in order to pay for these promises. (Ural Blend crude was trading $120 earlier this week.)
Reacting to these numbers Sergei Guriev, the rector of the New Economic School in Moscow, said:
It’s very hard to overestimate how vulnerable the Russian economy is to external pressures from the oil price. That vulnerability is huge, which is why Russia must be very vigilant. The [proposed] spending is a risk.
Citigroup says Putin’s new commitments would tally almost $100 billion per year, while Fitch cautions that “the absence of fiscal tightening…would have a damaging impact on the Russian economy and public finances and would likely lead to a downgrade” of the nation’s credit rating.
Read the full story here.