In Putin Speech, Glimpses Of A New Model For Russia: Isolation

Midway through the bombshell speech that Russia analysts were already combing for clues to President Vladimir Putin’s political future, he took a small victory lap.

Putin touted his accomplishments in stabilizing the country after the chaos of the 1990s:

“We restored our state’s unity,” he said in the January 15 state-of-the-nation address. “We have overcome the situation when certain powers in the government were essentially usurped by oligarch clans. Russia has returned to international politics as a country whose opinion cannot be ignored.”

And then he laid down a small, but significant marker that signaled potentially a substantial shift in Russian policy:

“I truly believe that it is time to introduce certain changes to our country’s main law, changes that will directly guarantee the priority of the Russian Constitution in our legal framework,” he said.

International treaties, he said, and rulings of international courts “can be valid on Russian territory only to the point that they do not restrict the rights and freedoms of our people and citizens and do not contradict our constitution.”

For analysts paying close attention, it appeared to be another step for the Kremlin away from the system of international law and rules in place since World War II.

And it follows other moves the Kremlin has taken to pull Russia away from existing global structures, prompting a longtime Kremlin aide to write last year that Russia now faces “100 years (200? 300?) of geopolitical solitude.”

Shift To Autarky?

A shift toward autarky — the political science term that describes a system that does not rely on external trade or assistance — is how several Russian observers called it.

“The autarkic component can be felt,” Dmitry Oreshkin, a longtime political analyst wrote in a commentary. “It is clear that investments from outside will not come to us, they will have to take them from within the country.”

“Everything that changes with regard to further deepening the sovereignty of the country, right up to its isolation from the world and the nationalization of the elite, is changing,” Andrei Kolesnikov, an analyst with the Moscow Carnegie Center, said in an op-ed article following Putin’s speech.

The Kremlin for years has chafed at the litany of cases Russia has fought, and lost, at the European Court of Human Rights. Russia has had the highest number of judgments against it for several years running, according to court statistics.

Whereas human rights activists say this high number is reflection of longstanding problems in Russian courts, Putin, and some of his nationalist allies, have argued it is an infringement of Russia’s sovereignty.

That sentiment increased markedly in the wake of Russia’s 2014 annexation of Ukraine’s Crimean Peninsula — a seizure that was rejected by the United Nations and nearly all of its members. Western nations, including the United States, the European Union, and others, punished Russia with economic sanctions. Russia was suspended from the Council of Europe.

In 2015, the lower house of the Russian parliament passed a law that gave the government permission to ignore rulings by international courts.

But as Russian law experts said at the time, the law violated Russia’s own constitution.

On January 16, a day after the speech, Putin repeated his criticism of the European court, saying it sometimes makes “clearly illegal decisions.”

A year later after the law was passed, prosecutors at the International Criminal Court in The Hague classified the ongoing conflict in eastern Ukraine — which pits Ukrainian government forces against separatist fighters equipped and funded by Russia — as an “international armed conflict” between Russia and Ukraine. That ruling was essentially a legal finding that, contrary to Moscow’s denials, the Russian government was a combatant in the war.

Russia was not a member of the court, having never signed the relevant treaty. But Putin still responded by rejecting the finding and announcing Moscow had no intention to ever join it.

Other international tribunals that have handed down rulings against Russia include the Stockholm arbitration court, which ordered Russian state-controlled gas giant Gazprom to pay Ukraine nearly $3 billion. The Permanent Court of Arbitration in The Hague ordered Russia to pay $50 billion to former shareholders of Yukos, the private oil company that was dismantled and absorbed by the state-owned company Rosneft.

In an interview, Georgy Satarov, director of the Moscow-based think tank INDEM, sarcastically responded to the argument that Russian courts have supremacy over international law.

“How can someone dispute the decision of our courts on issues important to us?!” he told the newspaper Novyie Izvestiya. “It is unacceptable! This, of course, is an increase in autarky. We ourselves know what to do. No need to teach us. Our dirty tricks are our dirty tricks. And they do not concern you.”

Even after the Crimea annexation, Putin tried to emphasize Russia’s integration with the global community, telling a group of Russian and foreign policy scholars that Moscow was committed to integration with the outside world.

“We have no intention of shutting ourselves off from anyone and choosing some kind of closed development road, trying to live in autarky,” he said in the October 2014 speech. “We are always open to dialogue, including on normalizing our economic and political relations. We are counting here on the pragmatic approach and position of business communities in the leading countries.”

Economic Headwinds

Legal isolation aside, there’s also the continuing discussion of the go-it-alone approach to the economy.

Since the imposition of Western sanctions, Russian planners sought to find way to protect the country, in the event it gets involuntarily cut off from global financial institutions.

The Crimea sanctions resulted in major Russian banks being blocked from accessing foreign credit markets, as they tried to refinance loans on their balance sheets. The Kremlin stepped in to bail out several, including by extending low-interest loans.

Some lawmakers in the U.S. Congress have even called for legislation that would cut off Russia from the global banking transaction system known as SWIFT. In response, Russia has sought to build its own parallel system.

Russian fiscal planners and the Central Bank have made the country one of the strongest in the world in terms of its budget, its currency reserves, and its conservative outlook. But the economy overall faces rising headwinds and problems from a shrinking, aging population.

In his own comments to Novyie Izvestiya, Oreshkin criticized the Kremlin thinking, likening it to the 1920s-era New Economic Policy, which sought to rebuild the Soviet economy after the turmoil of the Bolshevik Revolution and the Civil War.

“To take investments from within the country, you have to print money,” he said. “And so that this money does not flow abroad, converting into currency or gold, apparently, it will be necessary, as was done at the end of the [New Economic Policy], to limit the possibility of exchanging rubles for foreign currencies.”

He also argued that was why the Kremlin decided to replace Prime Minister Dmitry Medvedev with Mikhail Mishustin, the head of the Federal Tax Service.

“It is for these purposes that a person like Mishustin, who led the customs, who managed the tax extraction, and who has experience in creating such structures and keeping them under tight control, is good,” Oreshkin said.

Discussions of Russian isolation aren’t new. As recently as December, Sergei Karaganov, a Kremlin-allied analyst and former policy adviser, called for “selective autarky with the shock development of a number of key scientific and technical sectors.”

Nor are they limited to political analysts and outside observers.

In 2018, Vladislav Surkov, an influential, long-time Kremlin adviser, raised the prospect of new isolation for Russia in an essay published in the journal Russia In Global Affairs, titled The Solitude Of A Half-Blood.

“Russia without doubt will engage in trade, attract investments, exchange know-how, and fight wars…compete and cooperate, cause fear, hatred, curiosity, sympathy, and admiration,” Surkov wrote. “But without false goals or self-denial.”

“Solitude does not mean complete isolation,” Surkov wrote, but he said Russia’s openness would be limited in the future.

After the 2014 split with the West over Russia’s intervention in Ukraine, Surkov wrote, Moscow faces “100 years (200? 300?) of geopolitical solitude.”

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