29 September 2020

Tuesday, 09:43

CURRENCY

REFORMATTING RUSSIAN STYLE

Russia on the eve of political, economic and social changes

Author:

01.02.2020

On January 15, immediately after the annual address of the Russian President Vladimir Putin to the Federal Assembly, the entire Russian government resigned. Putin announced a number of proposals in the political, economic and social spheres of the country, as well as substantial constitutional reforms.

Such a turn came as a surprise for the world community and Russia, including the Russian ministers. A few days later, Mikhail Mishustin (53) was approved as the new prime minister to the surprise of journalists and political scientists. After all, Mishustin was not a popular person among the media and public. But what changes will this reformatting of the government mean for the future of Russia? Are the changes announced by Putin part of a larger plan to solve the so-called 'the 2024 Problem,' when the next presidential election will be held in the country?

 

The essence of proposals

First, Putin proposed "setting the status and role of the State Council" in the Constitution of Russia. At present, the role of the State Council is not specified in the constitution, and it is just an "advisory body" under the president, who is the chairman of the council. In addition to the president, the council includes speakers of the State Duma and the Federation Council, leaders of the Duma factions, governors and some former heads of regions. At the same time, Putin said that he intends to "radically increase the role of governors in the development and adoption of decisions at the federal level." According to experts, the most interesting part of the ongoing debates is what exactly will be the powers of the State Council. Yet, perhaps, even after the approval of the council's role, some of its functions will be formulated ambiguously to have a room for possible manoeuvres of the future president.

Putin also proposed to transfer more powers to the State Duma so that the lower house of the parliament has the opportunity to approve not only the prime minister, but also all vice-prime ministers and ministers. The Federation Council will take part in consultations on the appointment of heads of law enforcement agencies and regional prosecutors. Senators will have the right to dismiss the judges of the Constitutional Court. Obviously, Russia will not become a parliamentary republic, and the president will remain a strong public figure. After all, something similar exists in many countries with strong presidential rule, including in the United States, albeit in varying forms and degrees.

The next proposal is to amend the provision prohibiting the same person from holding the office of president for more than two consecutive terms. It is clear that the word 'consecutive' seems unnecessary  here, and it will most likely be removed from the constitution. Lawmakers are also going to amend the provision regarding the local residence requirement for the president of Russia from 10 years to 25 years for any Russian citizen who has never had foreign citizenship or residence permit. The ban on foreign citizenship and residence permits abroad will also apply to judges, heads of constituent entities of the federation, deputies, senators and members of the government.

Another very important proposal is to limit the priority of international law and treaties, as well as the decisions of international institutions in Russia, if they contradict the constitution of the Russian Federation.

 

Government

In the words of the resigned prime minister Dmitry Medvedev, the Russian government resigned as a whole "in order to update the existing political system in the view to better meet the greater challenges". The new prime minister, Mikhail Mishustin, formed a new team of ministers as soon as possible. As a result, the staff and the structure of the Cabinet of Ministers has changed almost by half. The number of deputy prime ministers was reduced to nine, the Ministry of North Caucasus Affairs was abolished, and curators were replaced by four federal agencies. As for Mishustin himself, his major achievement as the former head of the Federal Tax Service was the most effective and efficient use of digital technologies. According to official data, tax revenues to the budget over the five years have increased by 39%, VAT collection has become generally the best in the world. Therefore, the new head of the Russian cabinet is characterized as "exceptional expert", "restrained technocrat", "technocrat without political ambitions." In addition, he is called a compromise figure, who is likely to fulfil the role of a technical premier of the transit period. He is set to distribute the cash flows of the country, to realise Putin's tasks and to take all the public heat due to budgetary drawbacks.

 

Reason for change

What is the reason for the changes? Many world experts mostly agree that Putin is looking for ways to stay in power after his tenure in office. It is assumed that his reforms can eventually leave a set of ceremonial roles for the next president, while Putin becomes a prime minister again. However, most of these experts believe that the Russian leader can follow the path of Kazakhstan, that is—by expanding the role of the State Council in the same way that Nursultan Nazarbayev did before his resignation and his role as 'the leader of the nation' (elbasy) in the constitution of this country. Putin will take the post of the chairman of the State Council without any time constraints limiting his meddling with politics when necessary, and free of the tedious routine work related to running of the country. Under such conditions, Russia will still need an institution of the president strong enough to rule the country, but also moderately loyal to the Head. Therefore, Putin is now looking for a successor, taking into account all these conditions.

Meanwhile, the second version of possible scenarios, which, however, does not contradict the first one, says that at this stage Putin’s main goal is not so much to find a successor as to weaken carefully the system of governance, which current provides the president with almost unlimited opportunities. In other words, not only does Putin want to secure broader powers for himself after 2024,—which is still possible—but also to introduce such a political mechanism in which power would no longer be concentrated in the hands of a single person.

Obviously, the existing model of public administration has been established in Russia twenty years ago—in rather difficult internal and external conditions, and it no longer goes in line with modern challenges and prospects. Russia has still many weaknesses, such as the not very effective parliament, the judicial system and so on. The Russian Federation is a huge country, where life in its different parts often resembles life in different states. Putin is in the prime of his political life and realises that he cannot rule forever. After all, the Russian history has many sad examples of the rule of the aged leaders, and Putin obviously does not want to follow the same path in the future. Given the personal qualities of the incumbent host of the Kremlin, we can assume that he wants to remain in history not only as a strong politician, but also as a strong statesman. Thus, the ultimate goal of the changes in Moscow is to launch a political machine that guarantees the absence of widespread economic and political upheaval when changing leaders. This requires a very clear and well-functioning system of checks and balances, which would give a life-long lesson for the ruling elite and various branches of the government—being able to compromise and negotiate. On the other hand, internal problems in Russia require close attention to meet the public demand. Therefore, in his address to the Federal Assembly, Putin also addressed the issues related to pensions and retirement, healthcare, and maternity capital. The course is set, and this can be seen in the dramatic change in the rhetoric of federal media outlets of Russia, which have switched from discussing the situation in Ukraine to issues of education, healthcare, and infrastructure in Russia.

If our assumptions about the long-term future are true, then in the near future Mishustin will have to reform the budget for 2021, keeping the bar of considerable social obligations. In addition, experts predict early elections to the State Duma this autumn or spring of next year. We soon will see the modernised model of governance in the Russian Federation, but we understand that this process will not be quick and painless. Russia will need to reformat and to materialise all its strategic, scientific, geographical, security potential, as well as the resources. If it can keep at least control the situation with demography, implementing further reforms in healthcare and education, and if there are no large-scale shocks in the external situation or serious natural disasters, then in the second quarter of the 21st century we will probably see a completely new geopolitical actor on the Eurasian continent.



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