Books June 2014

What Putin Wants

Respect, sure, but also money. How that shapes his relations with the West.
Edel Rodriguez

In September 2009, Václav Havel and 11 other European dignitaries published an open letter challenging the United States and other NATO countries: “Are we willing to accept that the borders of a small country can be unilaterally changed by force? Are we willing to tolerate the de facto annexation of foreign territories by a larger power?” The questions were prompted by the Russian carve-up of independent Georgia after the brief Russian-Georgian border war of 2008. The answers were already evident by the time they were asked: Yes, we would accept the intrusion. Yes, we would tolerate it.

The decisions from which the West recoiled in 2009 informed the actions that Russia has taken in 2014. Five years later, the borders of a much larger country, Ukraine, have been unilaterally changed by force. The conquered territory, Crimea, has been annexed not only de facto, but by a juridical act of the Russian state. The attack on Crimea took Western intelligence agencies by surprise. U.S. intelligence was briefing journalists that Russia would not invade Crimea up until the day Russia invaded Crimea. Too bad no one at the CIA was reading the astute new book on Russia by Ben Judah, a Russian-speaking British journalist who has been reporting on low life and high life in and around Moscow, as well as in the bleak cities of the hinterland, for more than a decade. Judah explains the manic self-confidence—and the insecurity—of Vladimir Putin’s Russia. His core insight: the fragile empire, as his title describes Russia today, is such because it is built on a foundation of plunder.

Judah advances two predictions, both borne out by the early phases of the Crimea crisis: So long as Putin retains power, Russia can never evolve into a normal state. Anything resembling the rule of law would put an end to the organized looting that has so fabulously enriched Putin and his inner circle. At the same time, Putin cannot afford to push his confrontation with the West to an outright breach. His entourage of bureaucrats and oligarchs has stashed tens of billions of dollars of ill-gotten gains in Western investments and bank accounts, where the fortunes could be traced and sequestered if the United States government were ever sufficiently provoked. A crooked dictator of a small banana republic can secret a few million dollars in a Dubai bank account. But the sheer scale of the thievery committed by Putin and his group requires haven in assets available only in advanced economies: ranches in Australia, French government bonds, London apartments, stocks traded on the Tokyo or New York exchanges. That’s the dilemma of the political crook. He can store money where it is protected against adverse events at home or where it is beyond the reach of the U.S. Treasury Department—but not both. Putin leads a brutal regime, but also a vulnerable state.

Judah is not the first to try to follow the Russian elite’s money. One common theory goes that, under Putin, former KGB agents have renationalized the state assets seized during the Yeltsin years by self-made oligarchs like Boris Berezovsky and Mikhail Khodorkovsky. In the process, the intelligence cabal has lavishly rewarded itself. But Judah’s narrative suggests a different picture: Putin is the ultimate Berezovsky, not his antithesis—a lone actor, not the leader of a KGB putsch. Putin was nobody very important in the Soviet-era KGB. His ex-KGB associates ranked even lower than he did. He maneuvered deftly through the aftermath of the Soviet collapse, rising from involuntary retirement in 1990 to a job at St. Petersburg State University, then to the deputy mayorship of St. Petersburg, then to Moscow and four years of skillful self-ingratiation with President Boris Yeltsin. Yeltsin appointed Putin head of the security service, then prime minister, then his successor as president.

Vladimir Putin’s Russia is built on a foundation of plunder.

The most notorious story of Putin’s time in St. Petersburg, from 1990 to ’96, assigns him blame for the theft of tens of millions of dollars’ worth of emergency food assistance from Germany. Judah interviewed a partner in one of the corrupt business enterprises Putin allegedly developed further along his path to power. It was a medical-supply company that accepted donations from Yeltsin-era oligarchs to provision badly underequipped Russian hospitals—and then scraped 35 percent off the top, supposedly for investments in the Russian economy. By 2005, according to the ex-partner, the fund had accumulated more than $200 million, some of which went to the building of Putin’s infamous Black Sea palace—though the Kremlin steadfastly denies this.

Putin may be a Soviet man, as Judah puts it, but he owes his rise to post-Soviet conditions. And when he at last goes, he is unlikely to leave anything enduring behind. Judah quotes Putin’s own spin doctor Gleb Pavlovsky, a manufacturer of Putin’s (highly artificial) macho-man image: “Everyone has an interest in the [Putin] system—and everyone is disloyal to it!” The corrupt Russian president has forfeited his ability to prevent the petty corruption of police and inspectors—“corruption that Putin would not have wanted as it undermines his legitimacy,” Judah writes. He has “removed everyone capable of fighting corruption in the bureaucracy and made his image reliant on the bureaucracy. This gives officials impunity to behave in a predatory manner.” Moscow’s orders are disobeyed in the provinces, and Putin is left to try to look all-powerful without any mechanism other than intimidation to impose his will.

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David Frum is a senior editor at The Atlantic.

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