Putin maps the boundaries of greater Russia

By Philip Stephens

Published: August 28 2008 18:37 | Last updated: August 28 2008 18:37

We need to get this straight. Vladimir Putin’s Russia has invaded a neighbour, annexed territory and put in place a partial military occupation. It seeks to overthrow the president of Georgia and to overturn the global geopolitical order. It has repudiated its signature on a ceasefire negotiated by France’s Nicolas Sarkozy and disowned its frequent affirmations of Georgia’s territorial integrity. Most importantly: all of this is our fault.

The “our” in this context, of course, refers to the US and the more headstrong of its European allies such as Britain. If only Washington had been nicer to the Russians after the fall of the Berlin Wall. If only the west had not humiliated Moscow after the break-up of the Soviet Union.

Surely we can see now what a provocation it was to allow the former vassal states of the Soviet empire to exercise their democratic choice to join the community of nations? And what of permitting them to shelter under Nato’s security umbrella and to seek prosperity for their peoples in the European Union? Nothing, surely, could have been more calculated to squander the post-cold-war peace.

Such is the cracked record played over and over again by the Russian prime minister and recited now by Dmitry Medvedev, Russia’s notional president. Sadly, it also finds echoes among those in Europe who prefer appeasing Mr Putin to upholding the freedoms of their neighbours.

This Russian claim to victimhood is as vacuous as it is dishonest.

Mr Putin has said the collapse of the Soviet Union was the great geopolitical catastrophe of the 20th century. Now he wants to subjugate his country’s neighbours in the cause of a greater Russia. The aim is to turn back the clock: to extend his country’s borders to create the greater Russia sought by the leaders of the abortive coup against Boris Yeltsin in 1991. The west must not collude with Mr Putin’s falsified version of history.

There is no doubt that Russians feel they suffered great hurt and indignity during the 1990s. They did. But it is a misreading of events to blame the US, the west, the EU or Nato.

The blindingly obvious point is that humiliation was inevitable and unavoidable. Until the collapse of communism the world belonged to Washington and Moscow. Suddenly almost everything was lost to Russia. The political and economic system that had once aspired to global domination was reduced to dust.

Open a history book. Humiliation is what happens when nations lose their empires. Ask the British. Half a century after Suez, part of the British psyche still laments this retreat from the world. You could say the same about the French.

The implosion of the Soviet Union could not stir anything but a sense of shame among Russians. But ah, you hear Mr Putin’s apologists say, the west fed Russian paranoia. For half a century central and eastern Europe had been signed over to Moscow. Now the west’s institutions rolled like tanks up to Russia’s borders.

The problem is that this account does not fit the facts. George H.W. Bush was anything but triumphalist in his response to the fall of the Berlin Wall. Indeed, the then US president faced sharp criticism from many Americans for refusing to dance on communism’s grave.

It is true Bill Clinton’s presidency began with some rhetorical flourishes about spreading democracy. And the US administration did press hard for the expansion of Nato, in part because the EU dragged its feet about opening its doors. Some doubted the wisdom of the Nato policy. George Kennan, the author of the cold war doctrine of containment, was among those arguing against Mr Clinton. But then, the revered Mr Kennan was not infallible. He had, after all, opposed the creation of the alliance.

Doubtless there were moments when the US, and Europe for that matter, could have been more tactful. The disciples of free markets dispatched to Moscow by the International Monetary Fund probably bear some blame for the catastrophic melt-down of Russia’s economy. But no, the historical record does not show a deliberate or concerted effort by the US or anyone else to mock or multiply Russia’s misfortunes.

When Mr Putin talks about humiliation, he means something else. Washington’s crime was to assume that the Yalta agreement had fallen along with the Berlin Wall, and that the peoples and nations of the erstwhile Soviet empire should thus be free to make their own choices.

In the Kremlin’s mindset, showing due respect for Russia would have meant allowing it to continue to hold sway over its near-abroad. The most that the citizens of Ukraine and the Baltic states should have expected was the ersatz independence now bestowed on South Ossetia and Abkhazia. Poles, Hungarians, Czechs and the rest should have been locked out of western institutions.

Mr Putin has reopened the issue that seemed to have been settled in 1991 when Yeltsin saw off the tanks at the doors of the Russian White House. Yeltsin decided that the borders of the Russian Federation should follow those of the Soviet republics. That left the Crimea as part of Ukraine, Ossetia and Abkhazia as part of Georgia. Mr Putin’s doctrine is calculated to reclaim Moscow’s sovereignty over ethnic Russians in neighbouring states. This is a greater Russia by another means.

The doctrine overturns one of the central geopolitical assumptions of the past two decades: that, for all its hurt pride, Russia saw its role as a powerful player within a post-cold-war geopolitical order. Mr Medvedev, speaking with his master’s voice, now repudiates the laws and institutions of that order.

For all the occasional bluster about a new authoritarian axis between Moscow and Beijing, the contrast that has most struck me in recent weeks has been between China and Russia. Beijing saw the Olympics as a celebration of China’s return as a great power. China has by no means signed up to the norms and assumptions of liberal democracy; it has still to decide whether it wants to be a free rider or a stakeholder in the international system. But it has concluded that its future lies with integration into a stable world order.

Moscow’s invasion of Georgia and its public scorn at the likely international response speaks to an entirely different mindset: a retreat from integration and a preference for force over rules. Russia’s neighbours are told they can be vassals or enemies. Mr Medvedev boasts Russia is ready for another cold war.

I struggle to see what Russia will gain. It is friendless. Governments and foreign investors alike now know that Moscow’s word is worthless. The price of aggression will be pariah status. Mr Putin, of course, will blame the west.

source: Putin maps the boundaries of greater Russia
Financial Times

Putin: US orchestrated conflict in Georgia

By STEVE GUTTERMAN – 20 minutes ago

MOSCOW (AP) — Russian Prime Minister Vladimir Putin accused the United States on Thursday of pushing Georgia toward war and said he suspects a connection to the U.S. presidential campaign — a contention the White House dismissed as "patently false."

In another sign of unraveling Russia-U.S. ties, Putin said that 19 U.S. poultry producers will be barred from exporting their products to Russia.

Putin, the former president and architect of an assertive foreign policy that stoked East-West tension even before Russia's war with the U.S.-allied ex-Soviet republic, suggested in an interview with CNN that there was an American presence amid the combat with a potential domestic U.S. political motive.

"We have serious grounds to think that there were U.S. citizens right in the combat zone," he said the interview broadcast on state-run Russian television. "And if that's so, if that is confirmed, it's very bad. It's very dangerous."

Putin's acid attack on the United States came as Moscow's bid to redraw Georgia's borders hit an obstacle among its Asian allies. France, meanwhile, said the European Union is considering sanctions against Russia for its conduct in the Caucasus.

The Russian leader said the poultry decision was unrelated to the Georgia issue. He said that the unnamed American producers ignored demands that they correct alleged deficiencies after examinations by Russian inspectors last year.

"We try and keep our industry out of politics and into marketing opportunities, but sometimes it's very difficult to separate the two," said Jim Sumner, president of the U.S.A. Poultry & Egg Export Council. He said Russia is a major market for American producers.

Putin said that Russia had hoped the U.S. would to restrain Georgia, which Moscow accuses of starting the war by attacking South Ossetia on Aug. 7. Instead, he suggested the U.S. encouraged the nation's leadership to try to rein in the separatist region by force.

"The American side in fact armed and trained the Georgian army," Putin said. "Why hold years of difficult talks and seek complex compromise solutions in interethnic conflicts? It's easier to arm one side and push it into the murder of the other side, and it's over.

"It seems like an easy solution. In reality it turns out that it's not always so," he said.

The United States has close ties with the Georgian government and has trained Georgian units, including for service in Iraq. But Russian officials have made statements aimed to convey the idea that Americans may have directly supported Georgia's offensive.

At a briefing Tuesday, the deputy chief of Russian military general staff, Col. Gen. Anatoly Nogovitsyn, showed off a color copy of what he said was a U.S. passport found in a basement in a village in South Ossetia among items that belonged to Georgian forces.

"We found a passport for Michael Lee White," Nogovitsyn said. "He's a Texan."

The U.S. Embassy in Georgia said it had no information on the matter.

Putin appeared to link claims of an American presence amid the combat with a potential domestic U.S. political motive.

"If my guesses are confirmed, then that raises the suspicion that somebody in the United States purposefully created this conflict with the aim of aggravating the situation and creating an advantage ... for one of the candidates in the battle for the post of U.S. president." Putin did not name a party or candidate.

White House press secretary Dana Perino called Putin's contentions "patently false." She said "it also sounds like his defense officials who said they believe this to be true are giving him really bad advice."

She added: "To suggest that the United States orchestrated this on behalf of a political candidate just sounds not rational."

Perino said Russia is facing the consequences of a diminished global reputation and that "there will be other" consequences as well. She refused to say what they would be and said there is no timetable.

Putin said the imminent ban on imports from 19 poultry producers was "purely economic." He said another 29 producers would receive warnings.

U.S. producers supply nearly 75 percent of the total poultry import quota set by Russia, which stands at 1.2 million tons. Russia represented the largest export market for chicken broilers made by U.S. producers in the first half of this year, said Jim Sumner, president of the U.S.A. Poultry & Egg Export Council

Sumner said he expected the alleged plant deficiencies to be corrected within weeks or a few months and said the stoppage would not have a major impact on U.S. producers.

In Tajikistan, China and four Central Asian nations joined Russia in criticizing the West. Wary of separatists and restive religious groups at home, however, they stopped short of heeding Russian President Dmitry Medvedev's call to carve out two new nations in a volatile region at the crossroads of Europe and Asia.

Medvedev had appealed to the Shanghai Cooperation Organization — whose members are Russia, China, and four Central Asian countries of Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan — for unanimous support of Moscow's response to Georgia's "aggression."

But none joined Russia in recognizing South Ossetia and another breakaway Georgian region, Abkhazia, as independent countries.

"The participants ... underscore the need for respect of the historical and cultural traditions of each country and each people, and for efforts aimed at preserving the unity of the state and its territorial integrity," the declaration said.

The statement offered some praise of Moscow's actions, at least in the context of the peace deal signed five days after the war began. It said members welcome the cease-fire and "support the active role of Russia in promoting peace and cooperation in the given region."

But Alexei Malashenko, an analyst at the Carnegie Moscow Center, said the summit highlighted Russia's isolation, noting that not even U.S. foes Cuba and Venezuela have followed Russia's lead on recognizing South Ossetia and Abkhazia.

"The Soviet Union was not so alone even in 1968," he said on Ekho Moskvy radio, referring to the Soviet invasion of Czechoslovakia that crushed a liberal reform movement in the Warsaw Pact nation.

Western leaders have added condemnation of Russian recognition to their accusations that Moscow used disproportionate force in its Georgia offensive and has fallen far short of its withdrawal commitments under an EU cease-fire deal.

The EU is "trying to draw up a strong text signifying our unwillingness to accept" Russia's stance, French Foreign Minister Bernard Kouchner said Thursday.

"Sanctions are being considered ... and many other means as well," Kouchner told a news conference. The Foreign Ministry said later that France was not behind a sanctions proposal and that France's role would be to help reach a common EU position.

Associated Press Writers Peter Leonard and Olga Tutubalina in Dushanbe, Tajikistan; Jim Heintz and Misha Dzhindzhikhashvili in Tbilisi, Georgia; and Catrina Stewart, Nataliya Vasilyeva, David Nowak, Doug Birch and Mansur Mirovalev in Moscow, and business writer Emily Fredrix in Milwaukee contributed to this report.

source: Putin: US orchestrated conflict in Georgia
The Associated Press

Putin's Revenge for Kosovo and Iraq in Georgia

By wagering on NATO's lack of military options to confront Russia's actions in Georgia, and by controlling the bottleneck of energy flow to Europe through the Caucasus pipelines, Russia's new ruler Vladimir Putin has nearly put the finishing touches on America's downfall from its status as the world's only superpower, a process that began with its war in Iraq, or at least that is what he thought. Putin has wagered on Washington's military being tied up in Iraq and Afghanistan, as well as on Europe's internal division regarding the results of the US's unilateral adventure in Iraq. He has estimated that the US would lack the political and diplomatic influence, and that it would lose its prestige upon abandoning, in practice, democracy's spoiled child in Georgia, President Mikheil Saakashavili.

The US's decision regarding Russia's confrontational strategy (instead of giving priority to partnership) has its perspectives and implications not only in the context of bilateral relations between the two countries, or on the relationship between NATO and Russia's neighbors in the Caucasus. It also affects the position and status of the US all over the world, including the Gulf region with its oil and gas, and the Middle East with its conflicts.

Astonishment and verbal protestation will not be sufficient for a man of steel such as Putin, with his Soviet background, Russian nationalism, vast oil resources, and strategic oil partnerships with the likes of China and Iran. Retreating to the front, or escaping to the back, is the impression accompanying American and European responses, deepening the impression that the US has become a paper tiger, and Europe a wildcat that toys with the tiger but fears the Russian bear in its own home, which is why it will not dare to be defiant.

Given such a situation, it seems to some that the unipolar era is over, that a new world order is taking shape under Russia's leadership and that the US has run out of options. Yet, what will happen if the US decides take the initiative to use Iraq, as it had envisioned, as an unparalleled military base, and to redeploy its forces by tactically withdrawing its troops to aircraft carriers, informing all those concerned that it has decided to exercise what military might it has and that its hands are not tied?

What will happen if the US informs its NATO allies that Afghanistan is their mission and their responsibility, to free US troops of the military burden and remove its reputation for having its hands tied? What if Washington decides that the partnership with Russia over resolving the nuclear crisis by offering incentives to Iran has become ineffective, as Moscow has taken itself out of the partnership and exhausted diplomacy to serve Tehran's interest in buying time and stalling while reinforcing its nuclear capabilities and expanding its influence in Iraq, Syria and Lebanon, which the Islamic Republic of Iran has transformed into an Iranian base through Hezbollah?

The cost of these options should be considered on the basis of the cost of avoiding them. In other words, the US and Europe should carefully consider what to do with Putin's Russia, if they refuse to confront the fundamental message behind Russia's actions in Georgia, namely:

* Teaching every country in Russia's neighborhood the lesson that it must remain Moscow's friendly and obedient ally, and that it will not be allowed to become an ally of the US or a member of NATO.

* Informing Washington that it will not be forgiven for the mistake it made with Kosovo, and that revenge from Russia's perspective today is far more important than the partnership which was so important for Moscow under Mikhail Gorbachev and Boris Yeltsin. Things are different now, and the scope of such revenge will not be limited to the Caucasus but will reach the US wherever it finds the need to, in the Caucasus, Iran or elsewhere.

* Taking a qualitative step forward, in the framework of its oil and gas strategy, by securing Russia's control over the bottleneck of pipelines stretching across Georgia to Turkey which supplies Europe with its energy needs. Additionally, several major European countries, such as Germany, rely on Russia's gas for over 40% of their needs. Russia has laid an important foundation for its strategic decision to regain its former grandeur, namely that of oil alliances and gas balances.

The matter is not limited to Mikheil Saakashvili's excesses in South Ossetia or his miscalculations. It is rather about the meaning of submitting to Russia's response to what Moscow has described as adventures that must be stopped by any means necessary, including military incursion into Georgia's territories to teach it a lesson and to control the future of its pipelines. The leadership in Tbilisi, on the other hand, claims that Russia has set up a strategy of escalation and begun to provoke Georgia, and that Georgia had no choice but to defend itself.

Saakashvili has suffered great disappointment, as the US and Europe have, in practice, abandoned him. Perhaps he had believed that responding to Russia's show of power with a show of power of his own would automatically lead to partnership and accelerate Georgia's admission into NATO. So far, his wager seems to have failed on both counts.

What has taken place in Georgia constitutes a building-block in the grand Russian strategy set up by Putin in Russia's immediate neighborhood and on the international level. It would be wrong to believe that developments will be limited to the Caucasus or to Georgian territory, as Iran is the next stop in this strategy.

If Washington yields and behaves on the basis that its options are limited and costly and that it has no choice but to plead with Europe for salvation and bow down before Moscow, then the worst is yet to come. If those Americans who are angry at George Bush and his war in Iraq release their anger by rewarding Russia and Iran, and reinforcing their ability to expand, dominate, use threats and intimidation, revive the Soviet spirit, and mobilize allies on the basis of enmity to the US, it would be as if one were to chop off his nose to get back at his face.

There is now an urgent need for deepened strategic thinking regarding the American-European relationship, in the wake of the Iraq war in which the neoconservatives implicated the US. Such a war was a desperate decision which turned Iraq into a slippery step which may topple the US from its position of sole superpower. While the anger is well-founded, the challenges of the day demand far more than confining ourselves in blame and anger, and drawing lists of non-options. It is of the utmost necessity to formulate a comprehensive strategy towards Russia and Iran, at some point after the Iraq war, especially in the era of oil alliances and at a time when revenge is being employed as a fundamental political tool.

Moscow is not only taking revenge for Washington's mistake of supporting Kosovo's independence from Serbia, a measure which Moscow considered to be a direct insult, but also for the war in Iraq, of which excluding Russia from the country and its resources was a fundamental element. For two American errors, there were two Russian acts of revenge. And then there is Iran, where the matter is radically different, and where revenge takes a regional dimension, with a Russian-Iranian partnership directed against the US, based on exploiting American involvement in Iraq.

Vladimir Putin did not dwarf the US and turn it into a second-class country by his mere genius, but he intends to take advantage of the opportunity to abuse a dwarfed US to increase the possibilities of restoring Russia's grandeur. If he is met by apologies, he will move forward undeterred, supported by dangerous and violent nationalism. Only then will remorse catch up with those who focused the blame on Bush's adventures in Iraq and his mistakes in Kosovo, blame which he has certainly deserved, but without examining the designs of those benefiting from such errors and adventures, most particularly Russia and the Islamic Republic of Iran.

The Europeans in turn have the responsibility of careful examination, rather than simply following the trend of chewing hatred and blame for Bush and the US. They are on the verge of the worst economic recession in a Europe dependent on Russian gas. Today they have caught a glimpse and are now familiar with who Vladimir Putin is, how he thinks and how he acts.

When Putin resorted to military force against Chechnya, the world did not take notice of his military tendency to resolve problems by undermining diplomacy. Today, and merely to spite the US, many Muslims forget that Vladimir Putin has repeatedly taken violent military stances against Muslims in Chechnya and elsewhere, and celebrate his violence to compensate for their constant failure.

If the response is silence, fear, retreat and accepting that there is no other choice but submission, it will constitute a meaningful strategic message, not only to Russia but also to Iran, allowing them to further pursue their ambitions of regional hegemony. This is not an invitation to rush to military options against Iran or to a display of power directed at Moscow. However, both options are available, if the US wishes to resort to them, at a cost.

Perhaps the developments in Georgia will lead to seriously considering early withdrawal from Iraq to redeploy American troops on aircraft carriers where the US's naval military might is unparalleled. Such a measure would put an end to the impression that the US has no other choice but to submit. Tactical withdrawal from Iraq would free Washington's hands and enable the US to act confidently at sea.

The other option could be to stop saying and pretending that Iraq is not a military base for the US, and instead to behave in the opposite manner. In other words, it is perhaps time to cause a qualitative shift in the debate over US military capabilities inside Iraq, to turn them away from the dilemma of having their hands tied and to emphasize the importance and usefulness of Iraq being, in practice, an American military base that could be activated whenever the US's needs and higher strategic interests would demand it.

Bush may have underestimated Putin

What to do when Russia flexes its muscles?

August has surely been a strange month for Russians of a certain age.

Less than 48 hours after former KGB operative, erstwhile president and current Prime Minister Vladimir Putin cried at the state funeral of former Soviet dissident Alexander Solzhenitsyn -- a scene unthinkable 20 years ago -- he started bombing Georgia in Russia's first foreign incursion since the Soviet Union withdrew from Afghanistan 20 years ago.

The war in Georgia, which last week became so prominent a campaign issue in the U.S. presidential race that you'd have thought it started in South Atlanta and not South Ossetia, has been a violent reminder of what Putin, through his puppet President Dmitry Medvedev, is capable of when he feels dissed, provoked and flush with oil.

In the United States, the messages from the campaign trail were that John McCain is channeling Tom Clancy and that Barack Obama is damned if he acts presidential and damned if he doesn't, which is why he was asking for ceasefires, mediators and international peacekeepers while remaining in Hawaii instead of flying back to Washington.

This is the first 3 a.m.-phone-call foreign policy crisis test of the campaign, and the intensity of the diplomatic dueling reflects the increasing pressure on both candidates from their parties to break out of the statistical dead heat in the polls.

If it weren't for the reigning conventional wisdom that Russia is a friend and ally of the United States, you could be forgiven for thinking it's displaying all the swaggering, impulse control-challenged aggression of a classic petro-rogue state like Libya before Gadhafi went straight, or Iraq before the troubles.

But the crisis is also the product of a larger U.S.-Russia bilateral problem that the Bush administration will be leaving behind for whoever moves into 1600 Pennsylvania Avenue in January.

Presidents have the resources to set, at most, a handful of predetermined foreign policy priorities based on a range of factors including, among others, national security (which, in America, can cover a wide range of issues), trade and military commitments.

Because the president can meaningfully focus on only so many fronts at once, diplomacy through the State Department and other channels takes on added value when priorities are suddenly realigned, as they were in Washington on Sept. 12, 2001.

What is happening in Georgia is, in some ways, the product of this administration's diversion from the previous one's post-Cold War engagement with Russia to the overwhelming foreign policy priorities in Iraq, Afghanistan and the war on terror.

The relationship required particular fixing after NATO, over Russia's objections, rightly used air strikes in 1999 to stop Slobodan Milosevic's ethnic cleansing campaign in Kosovo, whose recent U.S.-backed accession to statehood only further infuriated Putin.

Not only has former secretary of state Madeleine Albright, a Democrat, questioned in the past few days whether President Bush underestimated Putin as a belligerent, McCain himself said Tuesday of Bush, "I don't know if the president quote, 'missed the boat,' but I do believe that the president probably had a higher opinion of Vladimir Putin than I do."

In a recent tour d'horizon of Bush foreign policy in Foreign Affairs magazine, Secretary of State Condoleezza Rice, who lectured on Soviet issues at Stanford University, lumped Russia in with China under the heading Great Powers, Old and New (Putin must have loved that) and devoted 236 words to the troubled relationship with Russia before shifting to China and then spending nearly 3,000 words on the Middle East, and that was before she got into a section titled The Transformation of Iraq.

This may be one of those weeks when the outgoing president is cursing his contempt for diplomacy.

How did French President Nicolas Sarkozy know so little about his interlocutors that he got snowed into agreeing to a ceasefire Wednesday that gave Russian tanks permission to move deeper into Georgia by Thursday?

How did Washington get so heavily invested in former New York lawyer and current Georgian President Mikheil Saakashvili that the United States is seen as a party to a predictable escalation it didn't have the leverage to defuse?

Churchill wasn't kidding when he said, "Russia is a riddle, wrapped in a mystery, inside an enigma." Any place that complex requires the same level of attention as an ally that it did as an enemy. Maybe that's the moral of this classically enigmatic Russian August.

By LISA VAN DUSEN

click here: Bush may have underestimated Putin London Free Press

Lets look at Russia gruppling with Inflation.

Remember Gorbachev? The leader who decided to play the western tune on democracy and transparency decades ago and soon saw his massive country weakened, crumbled and broken down into bits and pieces. Lets not compare with Abdullah. But Abdullah too lost 5 states recently. Transparency is like a diseases, very contagious. Tianamen Square is the court to settle the score on democracy, through the eyes of Chinese. But China is never worse off, infact theirs is getting so big ready to absorb anything thats in their way.

Here is an article for reference on Putin, Russia and all the rest that come with inflation.

BERITADARIGUNUNG:

Medvedev Seen As Likely Loser in Economic Policy "Clash" With Putin

By: iStockAnalyst Friday, July 11, 2008 6:55 AM

Text of article by Nikolay Vardul: "New centre of Russian power" by Russian newspaper Gazeta, owned by metals magnate Vladimir Lisin, on 1 July

Until recently - more precisely while Vladimir Putin was still president - everything in the structure of Russian power was transparent. Like the Eiffel Tower. The structure was known as the vertical axis of power, and everything was built around the Kremlin. There are now signs that the structure is becoming more complex.

Do you remember a premier standing up against the president? Well yes, it has happened. For example, when Vladimir Putin set the task of doubling GDP and Mikhail Kasyanov (the then premier) and virtually his entire cabinet staged a quiet revolt. Or when people from Vladimir Putin's inner circle got carried away with forming state corporations tailored to their own needs - corporations that are intent on controlling entire sectors and not intent, by virtue of their legal status (not the status that you were thinking of) of being fully accountable to be state, which had generously endowed them with assets - and next premier Mikhail Fradkov suddenly allowed himself to be somewhat critical of this zeal. But, first, all these critical statements were argued, as a rule, in technical rather than political terms. And, second, the critics did not remain at the political zenith.

What is now happening is something fundamentally new. The state of the economy has confronted the Russian authorities with a dilemma. Either to initiate a resolute and comprehensive struggle against inflation or to hope that economic growth will deal with inflation in the long term. The economic policy arsenal changes depending on which is chosen. In the former case, in particular, it is necessary to slow the growth of state expenditure, whereas in the latter, by contrast, it is necessary to utilize state investments to stimulate growth. It is clear that in both cases we are talking not about an instantaneous squeeze on the money supply or the dumping of all state reserves on the market but about some kind of smooth trend that the government should pursue. So, judging by his budget message, the president has made a choice in favour of combating inflation. Whereas the premier, judging by his Lesnyye Dali speech to United Russia members, regards combating inflation, which would call into question the immediate prospects for increasing economic growth, to be the wrong priority. A clash is in evidence.

I wish to stress that this is not simply a clash between the most popular Russian politician and his successor in the post of president. It is not Putin's government that is becoming a new centre of power - Medvedev has all the powers to eventually impose the order that he needs in the White House. The new centre of power is the United Russia party controlled by Putin personally.

There has not been this kind of of a vertical axis of power in post-Soviet Russia. If Putin sets about strengthening it in earnest, it could be the thing that puts him back in the presidency. How this would happen, he has just demonstrated by proclaiming much more populist slogans than the choice made by the president.

I can hear the worldly-wise reader signing sceptically: There is no real clash, they are talking about the same thing, only from different angles. The curious thing, however, is that if this is an agreed division of labour, it is by no means Medvedev who is coming out on top. So the precedent of the emergence in Russia of a nonpresidential vertical axis of power has been created.

[Description of Source: Moscow Gazeta in Russian - Informative, small-circulation daily paper owned by metals magnate Lisin; not affiliated with the Gazeta.ru website]

Originally published by Gazeta, Moscow, in Russian 1 Jul 08.