Intrigue behind Russia's power shift

By Lee Hamilton
May 7 2008

 While Americans focus on an historical presidential election this year — with Indiana playing a major role — there is an unprecedented transition of power taking place in Russia this week.

Today, Dmitry Medvedev, formerly first deputy prime minister and chairman of Russian energy giant Gazprom's board of directors, is being sworn in as president of the Russian Federation, succeeding Vladimir Putin. As Medvedev himself has said: “Russia's history knows practically no examples of a successful leader at the peak of his popularity moving on to a different post.”

Adding to the intrigue is Putin's new post: prime minister, a position that entails responsibility for policy implementation, budget management, and indirect control over government agencies through appointment powers. Putin also will lead the United Russia party, which controls over two–thirds of the seats in the Duma, Russia's parliament.

While the president is by far the more powerful of the two positions, Putin will play a key role in governing, perhaps a dominant role.

How much power will actually transition remains an open question.

Though Putin's approval rating exceeds 80 percent, his record on human and civil rights is far from admirable. Whether it's one of the eight unsolved murders of journalists since 2001, the crackdown on opposition leaders, the government's growing control over the media, or the weakening of provincial governments and parliament in favor of an increasingly powerful Kremlin, there are serious questions about Russia's commitment to the rule–of–law. Democracy has not prospered.

But many Russians have. The 1990s was a decade of poverty, hardship, lost prestige, and political uncertainty for most Russians. Russia has ridden the wave of rising oil and gas prices to levels of wealth unimaginable during the economic crisis of 1998. Real incomes are 2.5 times what they were in 2000.

Russia, however, faces serious economic challenges. Income inequality is extreme; the manufacturing sector is struggling; oil production is down, severe labor shortages are a growing concern for Russian leaders; the population is declining; corruption, crime and mismanagement are rampant; and transportation infrastructure is crumbling. The economy still needs foreign investment.

With average male life expectancy at 59, Russia's health care lags far behind the developed world. The pension system is unsustainable, quality education is becoming more elusive, and the lines dividing the public and private sectors are more blurry than ever.

High oil prices — the engine behind Russia's economic recovery — could be one of the casualties of a global economic slowdown, which would surely complicate Medvedev's efforts to attain Putin–like levels of popularity.

The president–elect's relationship with his patron dates to 1989 in St. Petersburg when the two worked together in municipal politics. But whereas Putin and many of the factions he presides over in the Kremlin have shared roots in the KGB and its post–Soviet successor, the FSB, Medvedev is a lawyer by training, with what many believe are more liberal economic and political tendencies.

Medvedev has emphasized his desire to assert “the supremacy of the law in our society,” built on a foundation of independent courts and judges.

But his legal background could also be a disadvantage. Putin has skillfully managed competing factions inside the Kremlin, maintaining a balance conducive to economic growth and political stability.

The crucial questions are whether the Russian system can be changed, and if so, whether Medvedev has the will and the capacity to change it.

Whatever Putin and Medvedev's past relationship, this new arrangement has the potential to expose ideological and policy differences, exacerbate factional battling, and reveal the fragility of Putin's gains. Or it could ensure continuity.

America's leaders must pay close attention as this new power dynamic takes shape in Russia, continuing to work with Moscow on key issues like non–proliferation, while encouraging gains in the quality of life of Russia's people.

 (Lee Hamilton is Director of the Center on Congress at Indiana University and Director of the Woodrow Wilson International Center for Scholars in Washington, D.C. He was a member of the U.S. House of Representatives for 34 years.)