Anatol Lieven - Global Strategy Forum ('GSF')

Mr Lieven was surprisingly dismissive of the suggestion that VV might perhaps be the richest man in Europe (and maybe, just maybe, in the world) at yesterday's Global Strategy Forum.  The point was picked up upon by Tony Brenton - former British Ambassador to Russia - who concurred with the view that corruption is not just a byproduct of the regime but in fact its 'raison d'etre'.

Why is the esteemed Mr Lieven so reluctant to accept the point or entertain the suggestion?

http://www.telegraph.co.uk/news/worldnews/1573354/40bn-Putin-is-now-Europes-richest-man.html

http://www.guardian.co.uk/world/2007/dec/21/russia.topstories3

Did Putin write Hungary's new constitution?

Being half-Magyar is a badge I’ve generally worn with pride.  Hungarians bravely tried to rise up against the totalitarian regime in ’56 only to be brutally suppressed.  Whilst the Solidarity movement in Poland did most of the heavy lifting that led, after a decade long struggle, to the fall of the Berlin Wall it was Hungary that played the final trump card by opening its border with Austria in May '89.  The Soviet Union’s satellite states had been provided with a corridor to the West, the Iron Curtain had been irrevocably pierced and within months the Wall came down and the Eastern Bloc ceased to be.

There are narcissistic affiliations too.  The expression that a ‘Hungarian who enters a revolving door behind you always exits first’ is a flattering one!

In the mid 90’s Hungary seemed so grown up politically, swapping governments between Neo Liberals and former Communists with ease and with all embarking on a similar reformist trajectory.   It was a source of pride that a country so nascent in its democratic transition could enact the necessary market reforms, regardless of the label or past of whichever party was in power at the time.

All this has changed with the ascent of Viktor Orban and his Fidesz party.  The comparisons between Orban and Russia’s Putin abound in the press.  The genesis of each, at least in terms of foreign perception, is uncannily similar.  This is not to suggest that Orban had a secret services background; quite the opposite - he was a visceral anti-communist but the warning bells have been ringing for many years now.  There has been a long forewarning of Orban’s nationalist and authoritarian tendencies, along with rebuttals that he’s just a decent guy trying to get the country on track, all so similar to how earlier fears about Putin were so plausibly, and disingenuously, explained away.

Putin’s first assault was on NTV; a staunchly independent television station though editorially ‘manicured’ according to the personal imperatives of its then Oligarch owner - Vladimir Guisinsky.  The state takeover, or expropriation, appeared an acceptable price to pay for what then seemed like the first stable government the new Russia had seen.   The naivety of those of us who accepted this position was laid bare on July 3^rd 2003 when Platon Lebedev was arrested and the Yukos affair began.

Concerns about Orban’s likely inclination toward a takeover of all state institutions were diluted by the previous Socialist government’s incompetence and barefaced lying as to the parlous state of Hungary's finances.  A free market nationalist with a strong hand might just be what the doctor ordered to get the country back on track, some thought.  It is even true the Fidesz party fairly won the parliamentary super majority they have since used to pass into law the new constitution.  

However, whilst the evils of the Putin clan in Russia - including sham democracy, subjugation of the rule of law at every level to political whim, vast personal enrichment to the tune of $billions (and serious allegations of extra judicial killing) – are of a magnitude that dwarf Orban’s sins; it is a fact that Orban & his Fidesz party have, in passing a grubby new constitution, consigned Hungary’s well earned democratic credentials to the dustbin. 

The Central Bank is now under the political control of one hegemonic party.  Constituencies have been gerrymandered to ensure that Fidesz should always maintain its 2/3^rd’s majority - a play straight out of Putin’s handbook! 

To quote the Financial Times: ‘The authority of the courts has been limited and the judiciary subjected to closer political supervision. The constitution asserts state control over personal conscience and faith. Abortion and same-sex marriages are outlawed and recognised religions limited.’

The problem for Orban is that Hungary is a small country of 10 million people without natural resources or any particular geopolitical importance.  Whereas Putin enjoyed 8 years of extraordinary economic boom as commodity prices soared, while the political vice tightened & the world kept schtum; Hungary is already experiencing the damage the markets can inflict upon states that engage in such malfeasance.  Hungary’s sovereign debt has been downgraded to Junk status and the Forint is at an all time low against the Euro.  Yet another EU country is on the brink of default.  The question is; does a country with such a constitution deserve to be in the EU at all?

South African model for Russia?

This post is in response to the following question asked by a good friend of mine in Moscow: "What would you see as an ideal, however realistic scenario (use real current players on both sides)?"

Judging what is or what might be realistic is a very difficult call given that what was deemed utterly unrealistic yesterday has a habit of becoming tomorrow's reality.  2011 is converting the realm of fantasy into stark reality with alarming speed.  Those who hoped to see Mubarak tried for corruption - as the lightest charge deserved - were occupying an unrealistic position until he appeared in court.  Saif Gadaffi was deemed the leading light of the reform movement in Libya but will now go on trial for crimes against humanity either in Libya or - less likely - The Hague.  The Syrian people are rising up against the Assad regime in a fashion that would have been deemed utterly unrealistic not so long ago.  The idea of 50,000 Russians, a people so emphatically disengaged from politics, demonstrating in Moscow would have been fantastical until Putin was booed at a martial arts fight setting off a chain reaction which led to 50,000 protesters becoming a reality.

What realistic scenario can emanate from the current political crisis?  Moreover what constructive scenario can follow?  The bottom line must be that the parliamentary election is re-run.  Right now that seems unrealistic but might not seem so tomorrow.  The main demand is that the people's votes are counted and that they are represented accordingly.  This would almost certainly lead to a government comprised of parties other than United Russia and, consequently, of someone other than Putin becoming president next March.  Therein lies the fundamental problem: Putin must run - and win - and his colleagues must stay in power as he & they see it as the only way to keep the staggering number of $ billions - perhaps well in excess of $100bn - that have been amassed over the past decade.  They also see it as the only way to maintain their freedom.  Andrei Piontkovsky quoted a 'Kremlin ideologist' in an excellent editorial in the Wall Street Journal (not usually my favourite paper) today as saying "We perfectly realise what is going on.  But its too late to jump off the train.  The new authorities will come after us and arrest us if we lose power.  That's why we have no option but to keep running like a hamster on a wheel".  There's the rub; every single actor on this stage could be prosecuted.  The entire edifice is rotten to its very foundations.  Everyone knows the corruption is monumental but the rot goes beyond kickbacks and the theft of state funds.  What would happen if the apartment bombings of '99 were thoroughly investigated?  What would happen if we could benefit from a proper enquiry into the destruction of Yukos, and those who profited from it?  What would happen if those responsible for the murder of Sergei Magnitsky (whom I had the fortune to know, albeit briefly) were brought to justice and their wider relationships with more senior actors in the corridors of power exposed?  Pull on one thread and it all unravels.

Russia has had enough revolutions and re distributions; something the protesters and Russians in general are apparently weary of.  So how does one reform the system and make a dramatic break with the past without tearing down the whole damn edifice, leading to inevitable profiteering by those claiming to rebuild it in the name of the people?  There needs to be a 'way out' whereby the perpetrators of crimes can know they will at least keep their freedom.  

The only process I can envisage is justice without retribution.  The populace needs to know exactly what has happened, who has stolen what and the details of crimes which are likely to include many far worse than theft.  By instituting a system similar to South Africa's Truth & Reconciliation Commission - whereby those who admit their crimes in detail are granted immunity from prosecution - Russia can benefit from the catharsis she was denied in the aftermath of the Soviet Union's collapse.  Unlike the examples, to name just three, of Poland, Estonia, & the Czech Republic where the old guard were largely expelled from political involvement; so many of the nomenklatura remained in power in Russia - and now not a few are billionaires guarding their treasure - which is the root cause of the imperfection of Russia's transition and why it has been so much less complete than is the case for its former Eastern Bloc vassals.  

Justice without retribution would, or might, allow those who are guilty to finally relinquish power without blood being spilt and allow the people to understand the full extent of crimes committed and lies serially told; thus affording a more transparent, representative, responsive and effective system to develop.  A system that would not rely on the current regime's preferred mechanism of show trials and jailings.  That might not seem realistic now but between now and March '12 who knows?