Why Putin is unlikely to change course (Part 1: The economy)

Note to readers: I plan to start blogging again, having recently retired from UC Berkeley and relocated to New York City. I will start with an exercise in empathy (which is different from sympathy), or if you prefer, red teaming or devil’s advocating (to coin a term). Specifically, I will try to imagine how a Putin advisor would likely assess Russia’s economic, political, and foreign/security circumstances on the eve of Putin’s all-but-certain reelection on March 18.

The main point of the exercise is to try to mitigate my own confirmation and preference biases, as well as those of other Western Russia watchers, many of whom suffer, in my view, from wishful thinking.

To be clear, I doubt some of the imagined advisor’s sanguine assessments, particularly on the foreign policy/security front. But I suspect it is the way that Putin and his kommanda see things. And it is why I think the Kremlin is unlikely to change course significantly, if at all, after March.

The advice takes the form of three memos (posts) from this advisor to Putin. I begin with a post on the economy. The next post will address domestic politics and regime stability. The final post will take up foreign and security policy.

None of the facts adduced in the series is intentionally inaccurate, although a great many facts are left out.

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Our economy is recovering after two years of contraction following the oil price and sanctions shocks of 2014. After declines of 2.8 percent and 0.2 percent in 2015 and 2016, respectively, growth should come in at about 1.7 percent in 2017, or perhaps a little higher. The economy is expected to pick up this year, with most forecasts predicting growth of 1.5 percent to two percent, and then a little over two percent over the next several years. There is a reasonable chance that the economy will do better than consensus forecasts. A November 2017 analysis from Goldman Sachs predicted the economy would grow at 3.3 percent in 2018 and 2.9 percent in 2019. Continue reading

Liberalism: What it is and what it’s not

Following is a presentation I gave at a two-day symposium, “Beyond Dichotomies: Rethinking the Liberal Agenda,” at The Central European University on March 28, 2017. The day the symposium began the University was informed of government-sponsored legislation that, if adopted, would effectively shut down CEU. The legislation passed yesterday, April 4, and is currently pending signature by Hungary’s president. For background, see New law imperils Central European University’s future in Hungary,Inside Higher Education, April 5, 2017.

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When I read that title for our symposium would be “Beyond Dichotomies: Rethinking the Liberal Agenda,” it struck me that participants were likely to have different understandings of what “liberal” and “liberalism” meant, which would make it difficult to collectively rethink the “liberal agenda.” So I thought I would take to take the opportunity to discuss “liberalism” as a concept, and clarify, at least for myself, what I mean by the term. I also thought it would be useful to consider how liberalism – again as I understand it – relates to other key concepts, including the obvious one, democracy, but also others such as Popper’s notion of the open society, neo-liberalism, the liberal international order, globalization, and multiculturalism.

To that end, I asked a Berkeley PhD candidate in political science, Melissa Samarin, to do a literature review for me and put together a sample of treatments of the concept by authoritative authors, as well as a smaller sample of definitions of those other related terms, which I’ll put up on blog as a PDF if anyone is interested. [Link: Samarin: Liberalism and related concepts.]

So let me start with a few general points about liberalism the concept. Continue reading

Risk, uncertainty, and black swans: Why Soviet socialism was forever until it was no more

Risk, Uncertainty, and Black Swans: Why Soviet Socialism Was Forever Until It Was No More 

Talk given at the Annual Berkeley-Stanford Conference

UC Berkeley, March 3, 2017

A few words to begin with about the title.

Many of you probably recognize the reference to Alexei’s terrific and influential book about late socialism, “Everything Was Forever Until It Was No More.” The book is framed around a particular observation, which is that in the late Soviet period Soviet citizens assumed that Soviet socialism would last forever, but after the fact they looked back and saw all sorts of reasons why it had to collapse.

It wasn’t just Soviet citizens who felt that way, however – outside observers did as well. Indeed there has been a great deal of criticism of academic specialists, and perhaps more importantly of the U.S. and Western intelligence communities, for having assumed that “everything was forever” and for failing to predict the collapse of communism in the USSR and Eastern Europe. In fact, just yesterday I read a piece in Foreign Policy claiming that Kremlinologists are “ haunted” by their “fabled inability to foresee one of the most significant geopolitical events of the 20th century — the collapse of communism and the Soviet Union.”

My argument that if indeed they are haunted – which I don’t think is true, at least I’m not – they shouldn’t be. On the contrary, the early assumption of both Soviet citizens and outside observers that “everything was forever” was entirely reasonable, and ex-post claims that what happened was predictable are not only wrong but reflect a typical cognitive bias highlighted in some of the research in psychology and behavioral economics on cognition and irrationality in decision-making.

In short, my argument is that the collapse of the Soviet Union shares at least one thing in common with Donald Trump’s election as president, which is that it was a highly improbable outcome with enormous consequences. Which is to say, it was a black swan.

A few general points before diving in. Continue reading

Putin’s dilemma: Why pushing back against NATO “encroachment” makes Russia’s NATO problem worse

As readers of this blog know, I believe that Putin and his advisors are convinced that the United States is trying to encircle, contain, weaken, exploit, and even destroy Russia as a unified state. They are also convinced that the West’s rhetorical commitment to democracy is a smokescreen for U.S. hegemonic ambitions globally and in Russia’s rightful sphere of influence particularly. This understanding of U.S. objectives is also shared by the bulk of the Russian public. It’s what many Russians believed before the Ukraine crisis (and it helps explain why the Kremlin reacted the way it did to the Maidan events), and it’s believed all the more now that Russia has lost Ukraine as an ally and NATO is reinforcing its eastern defenses.

That Russian officials and the Russian public think this would be dangerous under the best of circumstances. Russia, after all, is a nuclear superpower with a large and very capable conventional military. What makes it particularly dangerous is the fact that the Kremlin’s security problems with NATO are not only getting worse but are likely to continue to do so for years to come. Moscow’s annexation of Crimea, its role in destabilizing the Donbas, and its intervention in Syria have been very popular domestically, at least to date. But they have also produced an American military “repivot” to Europe, a steady but significant increase in NATO hard power capabilities close to Russian borders, and a surge in military spending by most of Russia’s increasingly worried neighbors. Continue reading

Ten points about where U.S-Russian relations are headed

I’ve been asked to attend a workshop next month that will “take stock of the economic, political and foreign policy developments in Russia and their implications for the United States.” In preparation, I’m going to post a long analysis of where I think U.S.-Russian relations are headed, but for now let me summarize my take as follows.

  1. The already dangerous U.S./NATO-Russian military relationship is getting more dangerous.
  2. A continuation or further deterioration of the West’s security relationship with Russia is not in the interest of the United States or its allies.
  3. Russia’s security problems with the West are not going to be solved by undermining the European Union, by promoting divisions within the West, or by improving ties to China.
  4. Russia’s security problems with the West are not going to be solved by turning Ukraine or Georgia into permanent political or economic basket cases.
  5. Russian military operations in Syria have added to tensions with the West and have increased the risk of a military clash with NATO.
  6. Russia’s overall relations with the West in general, and with the U.S. in particular, are not going to improve significantly unless and until there is a stabilization of the NATO-Russia military relationship.
  7. It is unlikely that Western economic sanctions on Russia will be lifted even partially in this year, and Crimea makes it highly unlikely that they will be lifted in full for years to come.
  8. Making Russia’s security relationship with the West less dangerous is going to require direct negotiations between Russia and the United States.
  9. Those negotiations should focus initially on arms control and security-related confidence building measures, and they should be comprehensive and include not just negotiations on strategic (START) weapons but also on theater nuclear weapons (INF), on ballistic missile defenses (BMD), and most importantly on conventional forces dispositions (CFE).
  10. Progress on arms control can make the NATO-Russia military balance less dangerous and contribute to a gradual normalization of political relations (a détente)—way down the road it might even give Ukraine and Russia the space needed to negotiate some kind of status compromise over Crimea (but don’t hold your breath).

US options in responding to Russia’s military intervention in Syria

Last spring, I argued in a talk at Berkeley that the Ukraine crisis was still very dangerous despite the signing of the Minsk II Agreement on the Donbas conflict. In brief, my reasoning was that (1) the Ukraine conflict is the product of an intensifying geopolitical struggle between Russia and the West in general and the United States in particular; (2) there is a powerful ideological component to that struggle, which is one reason why it is very likely to last for the foreseeable future; (3) the most dangerous dimension of the struggle is the military one; and (4) there is a non-negligible risk of a military clash between NATO and Russia.

I’m going to double down on my Chicken Little-ism today and make three points about Russia’s military intervention in Syria: (1) the immediate effect of the intervention is to increase the risk of a military clash between Russia and the United States or one of its allies; (2) it is very unlikely that Russia’s intervention will lead to a genuine “grand coalition” against ISIS or “terrorism”; and (3) there are no good options for Washington in Syria in general, and no good options in responding to Russia’s intervention in particular. Continue reading

Nine points about Ukraine’s prospects for Euro-Atlantic integration

Summary

  1. There is a distinction between “accession integration” and “becoming European,” and Kyiv should treat accession integration as a possible means for becoming European, not as an end in itself.
  2. Becoming European would be a huge challenge for Ukraine under the best of circumstances, and these are far from the best of circumstances.
  3. The European project is in crisis, which not only makes accession integration all the more difficult for Ukraine but also reduces its benefits.
  4. It is unrealistic for Ukraine to expect to join the EU anytime soon.
  5. Joining the EU is neither a necessary nor a sufficient condition for Ukraine becoming European.
  6. NATO already has a serious security problem with Russia, and it is not going to want to make that problem worse by offering membership to Ukraine.
  7. It is unrealistic for Ukraine to expect to join NATO anytime soon.
  8. Joining NATO is not a necessary condition for deterring further Russian aggression.
  9. To become European, Ukraine is eventually going to have to improve relations with Russia.

Continue reading