Putin makes changes as Russia stagnates

Russia’s Prime Minister Dmitri Medvedev and members of the Russian cabinet resigned on January 15 as President Vladimir Putin announced sweeping new changes to Russia’s parliament and the State Council. Within hours of the resignations, Maxim Mishustin, head of Russia’s Federal Tax Service (FNS), was proposed to Russia’s parliament— the State Duma—as Medvedev’s replacement.

With Putin’s presidential term set to end in 2024 and parliamentary elections to take place in late 2021, Medvedev’s resignation and Putin’s proposed changes come at a time when the Russian president is looking to secure a possibly uncertain political future. Putin’s two-term limit leaves him with limited options to maintain his proximity to power.

Putin’s proposal would move several key powers away from the presidency toward the Duma and the State Council, an advisory body that will receive new constitutional status. The most significant constitutional changes will see the Duma gain the power to appoint members of the cabinet, while the State Council will oversee the appointment of the heads of Russia’s security agencies. Putin would likely seek to head to the State Council in 2024, where he will be able to keep an eye on presidential and ministerial successors.

Medvedev’s replacement with Mishustin comes at a time when the Kremlin is seeking explanations for its continued stagnant economic growth. With economic pressures snapping at the heels of ordinary Russians, Mishustin’s lengthy technocratic career in Russia’s tax authority provides the Kremlin with the cover to portray its desire for economic security, while placing a relatively unknown figure to a significant figure to ensure no radical changes in policy.

Anders Aslund, Senior Fellow, Eurasia Center, Atlantic Council:

The great surprise has been that Putin has kept his hapless Prime Minister, Dmitri Medvedev, for so long. The best that could be said about Medvedev is that he was so weak that he could be sacked at any time. Putin has systematically reversed the few reforms Medvedev introduced as president 2008-12. Alexei Navalny (Founder of the Anti-corruption Foundation) has revealed Medvedev’s massive corruption in his excellent film seen by more than 32 million people. By keeping Medvedev in place, Putin has made clear that he had no intention to carry out any reforms. Yet, there is no reason to believe that he will do so now.

Michael Carpenter, Senior Director, Penn Biden Center; Senior Fellow, Eurasia Center, Atlantic Council:

This is a classic Putin move: acting decisively at a time of his own choosing and when others around him are least expecting it. Putin’s motivations are quite clear though: namely, he seeks to retain power after the next elections in 2024 when he is constitutionally obliged to step down as Russia’s president. His proposed constitutional changes, therefore, transfer a significant chunk of executive power from the presidency to a new State Council, which he no doubt plans to chair. By appointing an unknown technocrat like Mishustin, with no power base of his own, as Prime Minister, Putin also wants to have a malleable figure in charge of the government. This means Mishustin is also the most logical candidate to succeed Putin as president since he would no doubt be perfectly content to serve even with greatly reduced presidential powers (something that can’t be said of the siloviki or of Medvedev). Also, Medvedev himself had become too brazenly corrupt, too illegitimate in the eyes of the public, and utterly devoid of any real authority among the Russian political class. The biggest unknown right now is what happens next with the Union State. Putin’s geopolitical ambition certainly remains the unification of Russia and Belarus, at a minimum. A grander plan would see the incorporation of Abkhazia and South Ossetia and a maximalist variant could, at least theoretically, also include eastern Ukraine (an ambiguity that plays well to Russia’s neo-imperialist elite). If such a Union State is successfully established before 2024, then Putin would almost certainly seek to be its head of state, which he could presumably do while simultaneously serving as head of Russia’s new State Council.

Ariel Cohen, Senior Fellow, Eurasia Center, Atlantic Council:

Clearly, Putin is preparing a transition for himself in 2024, when his presidential term expires. The personality of the next prime minister will be key to predict Russia’s power balance beyond Putin. He also announced the creation of a new body–The State Council–that will consist of governors, who are currently de facto appointed by the Kremlin. Therefore, the transition to the post-Putin era in 2024 has begun.

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Peter Dickinson, Editor, UkraineAlert¸ Atlantic Council:

The resignation of the Medvedev government has the appearance of carefully choreographed political theater. The aim was presumably to create the illusion of change as Vladimir Putin announced plans to revise the Russian constitution in order to extend his rule over the country indefinitely. Putin’s constitutional proposals offer the clearest indication yet of his intention to maintain control over Russia once his current presidential term ends in 2024. With four years still remaining until he is scheduled to step down, today’s speech suggests Putin is eager to get the issue of his post-presidential transition settled as quickly as possible without allowing uncertainty to mount. Putin’s last constitutional conjuring trick, which saw him return to the presidency in 2012 after a farcical four-year handover to Dmitry Medvedev, sparked mass protests in Moscow that left the regime rattled. With his approval rating currently in the doldrums, Putin knows he must tread carefully as he seeks to extend his reign beyond 2024. Much will now depend on the public reaction to Putin’s plans. Large-scale protests are unlikely but cannot be ruled out as Russians face up to the reality of a stagnating economy and the prospect of Putin in power for another generation.

Heather Conley, Senior Vice President for Europe, Eurasia, and the Arctic; and Director, Europe Program, Center for Strategic & International Studies:

Speculation about when President Putin would begin Russia’s political transition formally ended today with his surprise announcement of forthcoming major constitutional and leadership changes about which the Russian people will be “consulted” in some way. Announced well into an hour of a long speech, Mr. Putin’s announcement led to the immediate resignation of the Russian prime minister and his cabinet and the quick naming of a new, largely unknown technocrat who specializes in tax collection, as the next likely interim Russian prime minister.  Simply put, Vladimir Putin has informed the Russian people how he will wish to manage Russia and its so-called “managed democracy” to the betterment of his future. Mr. Putin has clearly been thinking about this new phase of his leadership of Russia. His plan underscores his desire to retain maximum flexibility for his future plans and keeps everyone else off balance while the Russian government spends its budget surplus lavishly on social spending, making all of these announcements and unanticipated changes publicly more palatable. By reducing the power of the presidency, we know assume someone else other than Mr. Putin will become president.  Although the prime minister will have more powers, it appears Putin is preparing to “lead from behind” the scenes rather than be forced to listen to and answer the constant complaints and headaches of governing. After the State Council is enshrined in the Russian constitution, Mr. Putin could chair that powerful body for life while his allies in the Security Council implement his wishes, leaving a technocratic Russian president or prime minister to manage the difficult problems while Mr. Putin retains full control over all the military and economic decisions that really count. All of the power and none of the complaints:  a perfect plan that protects his power and assets. Russia in 2024 will likely look similar to Russia in 2020 but with some new and powerless faces in outward-facing senior positions. Russia’s opposition will have no say in its outcome. As Harry Potter would say, mischief managed.

Mark Simakovsky, Senior Fellow, Eurasia Center, Atlantic Council:

Although the timing was potentially uncertain, the reason behind the Russian government’s resignation is clear: the public and perhaps final phase of President Putin’s “Operation Succession” (which has been ongoing behind the scenes for months) has been officially kickstarted, with Russia’s President launching preparations to end his role as Russia’s President by 2024 while finding a constitutional way to remain as the primary center of power in Russia after 2024 in a new role. Putin is no stranger to this preparation, as he placed Dmitry Medvedev into the Russian Presidency from 2008-2012 and engineered his own return to the Presidency in 2012. Despite today’s announcement, Putin will keep his options open for how he will transition away from the Presidency. His goal is to retain significant political control of the country and ensure he can manage Russian foreign policy after he departs the presidency.

To accomplish this task, Putin will need to generate constitutional changes, which may include giving constitutional status to the Russian State Council (which Putin conveniently created in 2000 as an advisory body to the President). Putin will also seek to use constitutional changes to transfer more power to the Russian parliament and potentially give it the ability to name Russia’s Prime Minister, potentially weakening the hand of the next Russian President. Putin will also keep open the option of creating a union state with Belarus, which would allow him to take a new leadership position merging the two countries.

Ultimately, the decision indicates that President Putin’s term as Russia’s President will end in 2024, and he is highly unlikely to run for a third term. The early decision to replace the government, however, indicates that Putin has a well thought through plan for his succession and will continue to adapt the Russian constitution to fit his own personal political ambitions to remain as Russia’s primary political force even after he departs the presidency. The decisions this week showcase that Russia’s claim of a “managed democracy” rely little on any semblance of democracy, and more on the continued management of Russia’s political, economic and military institutions by President Putin and those loyal to him. Although we can expect Kremlin policy to remain relatively unchanged at home and abroad, Russia’s political opposition will see through any Kremlin claims of bringing in new leadership that can address Russia’s rampant corruption and economic difficulties. Although Putin likely hopes today’s announcement to change the government will weaken growing domestic dissent, it won’t. Although “Operation Succession” has started with a clear goal in mind, it remains highly likely that Russia’s political transition in 2024 is neither certain nor will end up as the Kremlin imagines it today.

Maria Snegovaya, Post-Doctoral Fellow, Johns Hopkins University School of Advanced International Studies; Adjunct Fellow, Center for European Policy Analysis:

Putin wants to stay in power beyond 2024 and seems to have come up with an institutional design to achieve that goal. This design looks like some variation of Kazakh and Iranian models. Putin follows the model by former Kazakhstan president Nazarbayev, who in 2019 redistributed some power from Presidential office (including control for courts and silovikis) to other power branches—like Senate and Security Council. Senate was then led by Nazarbayev’s daughter, while Nazarbayev himself became a lifelong head of the Security Council.

Putin is proposing something similar with some authority starting to be redistributed from Presidential level to Federal Council (Russia’s Senate), Duma and State Council (an institution that until recently did not play much of a role). In the future, we will probably see more authority redistributed to the Security Council-level (which already plays a de facto role of Russia’s Politburo). Unlike Nazarbayev, Putin does not seem to want to bring his descendants into politics, so he will have to find a way to way to be indirectly in control of Russia’s Senate and Duma. This may look like some version of Iran’s Guardian Council with permanent unelected Ayatollah at the top.

Medvedev is appointed as the deputy of Putin who is chairman of the Security Council making Medvedev de facto Vice President. By contrast, Mikhail Mishustin is a technical specialist from the Tax Authority will likely focus on raising revenue, which is needed under a worsening economy.  This is very similar to what we saw between 2005-2007 when Putin was picking between Dmitry Medvedev and Sergey Ivanov to become his 4-year place holders as President of Russia. At the time PM position was also occupied by a technical figure—Mikhail Fradkov and Viktor Zubkov. The real successor candidates, Medvedev and Ivanov, at the time were deputy prime ministers. This suggests that Medvedev is seriously considered for a higher office in the future. Possibly, he will be the President again. If true, staying away from the government (that is very unpopular due to the economic stagnation in Russia) will isolate him from negative perceptions and may give a boost to his approval rating.

Ambassador Alexander Vershbow, Distinguished Fellow, Transatlantic Security Initiative, Atlantic Council; Former US Ambassador to Russia

Putin’s dramatic announcements of constitutional changes today and the resignation of the entire cabinet are clearly the first moves toward keeping Putin in power past the end of his Presidential term in 2024. While Putin declared that Russia will remain a Presidential republic, he signaled that the State Council—a minor body that he already chairs—may assume greater importance under the new system. This could mean that Putin will remain the supreme leader even after someone succeeds him as President in 2024, similar to how former Kazakh President Nazarbayev made himself leader for life last year. The resignation of Prime Minister Medvedev and his government may be a way of scapegoating them for Russia’s stagnant economic growth, rampant corruption, and other social ills. Perhaps taking a page from his friend Donald Trump, Putin is in effect saying, “only I can fix it” and that he should therefore rule indefinitely. Putin’s proposals to increase the authority of the parliament may be presented as moves to increase democratic accountability, but are more likely window dressing.

Michael Newton is an assistant director at the Atlantic Council’s Eurasia Center.

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The views expressed in UkraineAlert are solely those of the authors and do not necessarily reflect the views of the Atlantic Council, its staff, or its supporters.

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Related Experts: Anders Åslund, Michael Carpenter, Ariel Cohen, Peter Dickinson, Mark D. Simakovsky, Alexander Vershbow, Michael Newton, and Maria Snegovaya

Image: Russian President Vladimir Putin and Prime Minister Dmitry Medvedev attend a meeting with members of the government in Moscow, Russia January 15, 2020. Sputnik/Dmitry Astakhov/Pool via REUTERS