Russia and the Middle East
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The west must not make an enemy of Putin

21.01.2005
Once again, the west is getting Russia wrong. Opportunities to build a durable and constructive relationship with Europe's turbulent neighbour are falling victim to western arrogance and incomprehension.
Even a perfunctory glance at history shows that the decline of great empires is not usually a peaceful process. The Soviet Union provides what is perhaps a unique example of an empire putting itself into voluntary liquidation. Both Mikhail Gorbachev and Boris Yeltsin knew that they had limited time to dismantle the Soviet system before the reactionary forces could regroup. Weak and domestically isolated, they courted western political support. Under their leadership, Russia acquiesced to the extension of a potentially hostile military alliance to its western borders - abandoning not just brutal Soviet imperialism, but also its legitimate security interests. The temptation to exploit Russian weakness has proved irresistible to Nato.
In the aftermath of the 1998 debt crisis, Russia was widely portrayed as terminally weak and divided - doomed to decay, to default, to disintegration. The oligarchs were rightfully seen as uncontrollable, able to buy or intimidate anyone standing in their way, manipulating the political system to feed their own boundless greed. In parallel, the flow of power into the hands of the regional governors rendered Russia largely ungovernable.
Is it not odd then that the taming of both oligarchs and regional potentates by Vladimir Putin, the president, has been greeted internationally not with praise but with invective? Yukos - an oil company with its own foreign policy - effectively launched a hostile takeover bid for the Russian state. It used its vast wealth to buy a bloc of deputies large enough to obstruct any legislation not to its liking, by joining their votes with those of the Communists. Until the fall of Mikhail Khodorkovsky, Yukos's jailed chief executive and until recently a key shareholder, the oligarchs repeatedly blocked the imposition of the windfall oil profit taxes necessary to rebalance the Russian economy. The dismantling of Yukos has been badly mishandled. But had the Russian government allowed the oligarchs' stranglehold to be restored, a repeat of the financial catastrophes of the late 1990s was in the offing.
Unlike his predecessors, Mr Putin plays to a domestic audience. Under his watch, Russia has become a far more prosperous and self-assured place. Although the economy remains unbalanced, growth has been impressive - Russia has gone from insolvency to being a big net creditor. A large middle class has sprung up. Wages and pensions are now paid in cash and on time. High oil prices have helped, but they were also high in 1996, yet the proceeds were stripped and hidden offshore by the same oligarchs who are now coming under the whip.
In foreign policy terms, Russia no longer writes blank cheques for the west. Perhaps as a result, and aided by a hugely professional Yukos public relations campaign, the Putin administration is encountering the sort of press hostility ordinarily reserved for members of the axis of evil.
The protests come not only from the western media; perhaps the shrillest invective comes from a tiny minority of Russian professional dissidents. Isolated and ignored at home and desperate for western approval, the latter are in no way representative of the Russian people. Although the political demise of the Russian liberals is to be lamented, they were victims of their own folly. Admired abroad, at home they were perceived as being aligned with the rapacious and thieving oligarchs, as well as with the western powers who find a weak and subservient Russia a safer option.
Mr Putin is genuinely popular at home, and the west will have to learn to live with Russia's choice. It is absurd to expect Swiss standards of democracy from a country struggling to rebuild itself after the traumas of the past decades. Liberal democracy remains as much an alien concept under Mr Putin as it was under Mr Yeltsin. But as Russia develops into a middle-class country, it will gradually acquire political institutions more similar to those of its western neighbours.
The ability of the west to influence events within Russia is rapidly waning. Even if other countries had the means to destabilise the Putin regime, any successor would almost certainly be more threatening. Although military confrontation is no longer an imminent danger, under pressure Russia would probably turn east. It would seek a strategic alliance with a China desperate for Russian resources, a gift the west would come to regret.

*The writer is chief strategist for Sovlink Securities, Moscow
By Eric Kraus
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