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Putins Potemkin Village

Dr. Gary K. Busch


In the late 1780s Prince Grigori Alexandrovich Potyomkin-Tavricheski, a military commander and
protg of Catherine the Great, was sent South to subdue the Ukrainians and to take the Crimea. His
successes were very limited and most of the territory he conquered was a barren and derelict
region with few people and only the burnt remains of villages. Catherine decided to visit the Crimea
in 1787 to see her conquests. To impress her, Potemkin had hollow facades of villages constructed
along the banks of the Dnieper River in order to impress her. Soldiers lit fires to make it look as if
these villages were inhabited. There were no villages but there were elegant facades. This tradition
is carried on by todays Russian authorities as they pretend to be a world power equipped to
dominate their neighbours militarily and to exaggerate to the world community their ability to
influence the economic interactions of a global economy.
When the Cold War ended, the Soviet Union had a total population of nearly 290 million, and a
Gross National Product estimated at about $2.5 trillion. At that time, the United States had a total
population of nearly 250 million, with a Gross Domestic Product of about $5.2 trillion. That is, the
population of the United States was smaller than that of the Soviet Union, with an economy that was
only twice that of the Soviet Union. Two decades later, Russia's population is about 140 million, with
a GDP of about $1.3 trillion, while the population of the United States is over 300 million, with a GDP
of $13 trillion. Today, the population of the United States is twice that of Russia, and the US
economy is ten times as large.
Global tables of male life expectancy put Russia in about the 160th place, below Bangladesh. Russia
has the highest rate of absolute population loss in the world. The Russian population is aging, and
Russia remains in the throes of a catastrophic demographic collapse. The population is expected to
fall to 139 million by 2031 and could shrink 34 per cent to 107 million by 2050. Eight out of ten
elderly people in residential care have relatives who could support them. Nevertheless they are sent
off to care homes. Between two and five million kids live on the streets (after World War Two the
figure was around 700,000). Eighty per cent of children in care in Russia have living parents, but
they are being looked after by the state. According to data published by the Russian Federation
Investigative Commission, in 2010 there were 100,000 child victims of crime, of whom 1,700 were
raped and murdered. This means that four or five children are murdered in Russia every day. In
2010, 9,500 sexual offences were committed against underage victims, including 2,600 rapes and
3,600 cases of non-violent sexual relations.
Corruption is the rule in Russia. Practically every interaction between the citizen and the state
(bureaucracy, police, tax bureau, banks, etc.) involves some form of extra-legal payment for what
should be a free or regulated service. Even Vladimir Putin admits the scale of this corruption but
little is actually being done to combat it effectively.
Denying the truth is an integral part of Russian life. Participation in this national dialogue of fiction
became imbued in the public behaviour of the Soviet and Russian citizens. It was a given in public
discussions and university debates. There was no question that many, especially those who were
privileged to have travelled abroad, knew a different truth but, nonetheless, were compelled by
circumstance to repeat the polite fictions in their daily professional and personal lives. Bullshit was
ingrained as a feature of Soviet and Russian existence. Bullshit to foreigners was the bedrock of
Soviet foreign policy masking a vast economic and political weakness and incapacity.
Now, with the new controls of the press, television and the internet introduced by Putin patriotic
bullshit has become the single most competitive sport in the country. As the media has been put in
the hands of tame siloviki and the ultra-nationalists of the State Duma the Russian public is
bombarded by a wave of nationalistic bombast that seems to strike a chord among those who
bemoan the fact that Russia is really a second-rate or third-rate power with an aging and decaying
nuclear weapons potential. It is this refusal to accept reality and work out a program of national
growth which will take full advantage of Russias many assets that allow a little man behind the
curtain, as in the Wizard of Oz, to create the pretence of power and menace.
It took a gifted Ukrainian writer, Nikolay Gogol, to delineate the character of such a man. In his book
Dead Souls ( ) Gogol has as its main character Nozdryov, an utterly selfish man; the
man who seeks unlimited pleasure but demonstrates zero love. Literally everything Nozdryov does,
without exception, he does for his own amusement or pleasure. His defining character traits are
lying and gambling. He lies continually to promote his own interests. When he gambles, he prefers to
lose other peoples things. Nozdryov has the narcissistic need to be at the centre of everything, has
to be involved in everything he sees, and his selfishness and self-aggrandizement has no limits. He
has no conscience. He has a dead heart. The future Russian system of governance is characterised
even more brutally in the persona of Andrei Danilovich Komiaga in Vladimir Sorokins Day of the
Oprichnik in which many see parallels to the system which Putin helped create.
However, Putin could not have done all this alone. When he came to power he brought with him his
close circle of friends from the security services and St. Petersburg; the siloviki, and has surrounded
his court with these men ever since.
THE SILOVIKI
The new and powerful people (siloviki) have been almost exclusively drawn from the ranks of the
Chekists. A Chekist is a general, if pejorative, term for those who are or once were employed in
the security operations of the Soviet state- KGB, GRU, MVD, FSB etc. (the Organs) Dzerzhinskys
original agency was the Cheka. Under Putin, these new siloviki have been firmly installed in the
corridors of power.
Under Putin, the Chekists, primarily the St. Petersburg flavour of Chekist, openly took power as
ministers, government advisors, governors, bankers and politicians. There may be as many as six
thousands of these Chekists in powerful positions in the Russian state. There is no mystery about
who they might be; Nikolai Patrushev; Igor Sechin, now head of Rosneft; Yuriy Zaostrovtsev, deputy
chairman of the board of directors of Vneshekonombank; Viktor Ivanov, head of the Russian Federal
Drug Control Service (FDCS) who succeeded Nikolai Patrushev as the Head of the Internal Security
Department of Russia's FSB; Boris Gryzlov former Speaker of the Duma and now head of the United
Russia party; Sergei Ivanov, Vladimir Ustinov; Sergei Stepashin; Sergei Pugachov, president of
Mezhprombank Bank; Nikolai Negodov; Vladimir Yakunin, Konstantin Romodanovsky, Viktor
Cherkesov, Mikhail Fradkov. Aleksandr Bortnikov to name but a few. These siloviki are in top
managerial posts throughout the Russian economy and the civil administration. They have been
rewarded well for their loyalty to Putin.
What is important about the siloviki is that their business model for Russian business effectively
removes the linkage between the individual performances of a private company, a parastatal or an
industry from the funds it generates. Because of the configuration of the siloviki economy the profits
from the various producing entities and service industries are not kept in the name of the generating
company or service but effectively put into a central pot (like the obschak of the Mafia) for
distribution by the political leadership. This divorce from a direct line between earnings and capital
accumulation makes corporate planning a subject of political discussion and debate and a
competition for investment funds which is won by political access rather than economic profitability.
This is inimical to the notion of ploughing back profits towards R&D, maintenance and the renewal
of plant and equipment and keeping up with the needs of Russias worn out infrastructure.
By seeking to recreate the Soviet model of central control these siloviki have overseen the weakness
of the Russian economy and provided for the continued stranglehold of the siloviki on the direction
of the economy. This has had its effects on the economy but especially on the oligarchs who remain
in businesses but have removed the oligarchs access to political power. The oligarchs are, in many
ways, the first victims of Putin and the siloviki. They have real companies, real banks, real productive
capacities but these are becoming subject to the idiosyncratic demands of the siloviki with whom
they are in competition. Russian businessmen and siloviki have been pulling their money out of
Russia as fast as they can. Russian flight capital is of epic proportions; estimated to reach almost one
hundred billion dollars this year. Putins plans for adjustment of this anomalous economic model is
to insist on further lack of competition by choosing more corporations to come under whole or
partial state control and limiting the funds available for their modernisation. Western sanctions have
compounded these weaknesses.
These sanctions are important but a little misguided. While it is reasonable and just to attack Putins
cronies and business partners these are only rarely the oligarchs. Most of the oligarchs involved in
major international businesses- Lisin, Makhmudov, Aven, Fridman, Usmanov, Vekselberg, Blavatnik,
and others are tolerated by the siloviki and Putin but largely are internationalists with experience
of the world outside Russia. They would thrive and expand their businesses far better without Putin
and the siloviki. It is foolish to sanction them as they are the victims of the Russian system not its
perpetrators and will be needed to pick up the pieces when Putin and his cronies disappear. They
are getting their assets as far away from the Russian economy as possible. It is probably unwise to
freeze these. Sanctions should be directed at the siloviki, not the oligarchs.
THE MILTARY: RUSSIAS CORE FRAILTY
One of the most important failures of the Putin regimes has been their planned starvation of needed
funds to the military. The Soviet Union was a major world power because it had a powerful military
armed with the latest equipment, including nuclear weapons. Todays army is a pale shell of that
Soviet Army. In Soviet times the military was a major political force in the country. The Soviet Armed
Forces and the GRU were the third part of the troika that made up the Soviet Union
After the fall of the Soviet Union the military was kept in a state of dereliction and constraint. Russia
had suffered greatly as a result of the Afghan War. By the time of Gorbachevs accession to power
the war in Afghanistan had deteriorated badly. Resources were draining from the USSR budget and
military progress had stopped and containment was the policy. Gorbachev told the military that they
had a year to sort things out. They embarked on a policy of creating an Afghan Army which would
notionally take over from Soviet troops, who would then be free to return home. This did not work
so, at the end of 1986, they prepared to bring their troops home. The first contingent returned to
the USSR from May to August 1988 and the rest from November 1988 to February 1989. It was an
expensive and humiliating experience. After the war ended, the Soviet Union published figures of
dead Soviet soldiers: the initial total was 13,836 men, an average of 1,537 men a year. According to
updated figures, the Soviet army lost 14,427, the KGB lost 576, with 28 people dead and missing.
Material losses included: 118 aircraft; 333 helicopters; 147 tanks; 1,314 IFV/APCs; 433 artillery guns
and mortars; 1,138 radio sets and command vehicles; 510 engineering vehicles; 11,369 trucks and
petrol tankers. It was a very costly business. Not only was it costly, there was no budget to rebuild
the armed forces.
The armed forces were then forced to leave their bases in Eastern Europe to return home. Russias
most immediate neighbours, those who had been part of the Warsaw Pact, were nervously testing
their degrees of freedom from the Soviet embrace. The invasions by Soviet tanks of the East
Germans in 1953, the Hungarians in 1956, the Czechs in 1968 and the long history of Polish Soviet
conflict were too recent for these countries to forget. The third largest army in the world, the East
German, was out of business. Massive quantities of East German (e.g. ex-Russian) military supplies
were being offered at cut prices to the world as the re-unifying German state moved to change over
to NATO equipment. One of the Soviet Unions major industries, the arms industry, had the bottom
fall out of its market. This was coupled with the enforced withdrawal of Soviet forces stationed in
bases across Eastern and Central Europe. The Warsaw Pact disappeared; the COMECON disappeared
and there was not enough money in the reserves to keep paying, unilaterally, the costs of keeping
Russian troops outside of Russia.
The soldiers were never paid much to begin with but the fall of the Soviet Union meant that they
had very little indeed. These soldiers sold, with the connivance of their commanding officers,
anything that wasnt nailed down. They sold it for food and they sold it for trophies that they would
carry home as they were demobilised. Most importantly there was no place in the physical Russian
military establishment where these troops could be stationed. There were not enough bases inside
Russia where the returning troops could be housed. There were no jobs for thousands of trained
officers and NCOs. The offset costs for the Soviet Occupation paid by their former satellites were
no longer forthcoming. There were too many mouths to feed and too few bases in which they could
be sheltered. No one was sure what to do but everyone recognised the danger of a disgruntled army
full of people with grievances and with nothing to do.
When Putin came into office he cut the military budget even more. What little remained was
devoted to Putins new thrust into Chechnya which used up a substantial part of the military budget.
Since then Putin has been promising new funds for the military but these funds havent arrived. One
reason they havent arrived is that Russian military prosecutors have found that about 20 per cent of
Russian defence spending is stolen by corrupt officers and officials. This should surprise no one as
the only way that the officers could maintain their lifestyles was to steal money to do so. They saw
what the politicians were stealing so felt little inhibitions. The anti-corruption campaign in the
military has been going on for several years. A large part of the effort is directed at firms that
manufacture weapons whose prices to the government are disparate with the market. Last year, this
led to a curious confrontation which resulted in Russian shipyards refusing to build submarines for
the Russian Navy. The Russian shipyards are in such bad shape that the government recently allowed
the purchase of four Mistral class vessels from France, as well as the purchase of the manufacturing
technology so more Mistrals could be built in Russia.
Efforts to purge the forces of over 100,000 unneeded (and not very effective) officers ran into stiff
resistance. The senior generals and admirals wanted to at least let these men remain until they
reach retirement age, and leave with dignity, rather than being, in effect, fired. In 2012 the worlds
seas were almost entirely free of Russian submarines as only ten patrols were sent out over the
year; patrols that lasted for only days or hours. Most of the submarine fleet is scrap and unusable.
Tanks are no better. Currently, the most modern tank Russia has is the T-90, which entered service
in the early 1990s. Most of the 20,000 tanks (72 per cent of them in storage) in the Russian army are
T-72s and T-80s. Russia planned to replace most of those T-72s and T-80s with T-90s and a new
design, the T-95, by 2025 but the money ran out. On March 25, 2012 Major-General Alexander
Shevchenko announced the massive scrapping of Russias tanks, APC and trucks, including T-80, T-
64, T-55, tanks as well as a number of army trucks. Similar schemes are scheduled for the Russian air
force.
Russian Su-24s have been frequently grounded. In the last 12 years Russia has lost sixteen Su-24s to
accidents. Many more have been retired because of old age. This is one of the reasons Russia is
hustling to replace the Su-24s with Su-34s. It was only five years ago that Russia began building the
first Su-34 fighter-bombers (20 of them). These are now replacing the Su-24s. Most of the Su-24s
built are over 25 years old and many have been grounded several times recently because of age
related problems.
The Strategic Rocket forces are having difficulties with overage equipment. In January 2014 Russia
was estimated to have 489 strategic launchers and about 1700 nuclear warheads. In its September
2013 New START data exchange Russia reported 473 deployed launchers with 1400 New START-
accountable nuclear warheads. However the large majority of their missiles are R-36M2 (RS-20V, SS-
18) and UR-100NUTTH (SS-19) which will be out of date in a few years (2018) and the road portable
Topol (SS-25) is already out of date. The newer Topol-M (SS-27) and RS-24 missiles are from the
1990s and the long-awaited Bulava missiles keep crashing on their launch pads.
The submarine readiness is seen as unsatisfactory. Submarines of the Project 667BDR (Delta III) class
entered service in 1976-1982. A total of 14 ships of this class were built. These submarines carry the
D-16R missile system with 16 R-29R (SS-N-18) missiles. Submarines of this class are being withdrawn
from service because of age. Submarines of the Project 667BDRM (Delta IV) class entered service in
1985-1991. A total of 7 ships of this class were built, of which one (K-64 Vladimir) has been
converted into a special-forces submarine. The current plans call for keeping six 667BDRM
submarines in service, so the submarines are undergoing overhaul and are not available. Project 941
(Typhoon) submarines were deployed in 1981-1989. A total of six submarines of this class were
built. Submarines of this class carry the D-19 missile system with 20 R-39 (SS-N-20) missiles. Since
the missiles have reached end of their service lives, Project 941 submarines have been withdrawn
from service. In 1996 Russia began construction of a strategic submarine of a new class, Project 955
(also known as Borey or Yuri Dolgorukiy). Construction of a second submarine of this type, Aleksandr
Nevskiy, began in March 2004, and the third, Vladimir Monomakh - in March 2006. These
submarines are designed to carry 16 launchers of the failed missile, known as Bulava. Subsequent
submarines, known as Project 955A, will have 20 Bulava launchers. The first two Project 955
submarines - Yuri Dolgorukiy and Aleksandr Nevskiy - were accepted for service in 2013. However,
the submarines do not have missiles on board.
The Russian strategic aviation consists of 66 bombers that carry an estimated 200 long-range cruise
missiles and bombs. The bombers are 11 Tu-160 (Blackjack) and 55 Tu-95MS (Bear H). The bombers
can carry various modifications of the Kh-55 (AS-15) cruise missile and gravity bombs some are
coming to the end of their useful life.
As of June 2014, the space-based tier of the early warning system for the missiles included two
operational satellites on highly elliptical orbits. The constellation has impaired capabilities as they
cannot maintain 24-hour coverage of the U.S. territory. Russia's only geostationary early-warning
satellite, Cosmos-2479, launched in March 2012, has ceased operations. In March-April 2014 the
satellite did not perform its regular station-keeping manoeuvre and, according to Kommersant, was
formally declared non-operational by the ministry of defence in April 2014. Cosmos-2479 was a
satellite of the 71Kh6 type that was developed as part of the US-KMO early-warning system, which
was supposed to provide complete coverage of the northern hemisphere. However, the system
never reached operational status and Cosmos-2479 was said to be the last 71Kh6 spacecraft.
According to the Russian military the current state of the armed forces is not constituted to pose a
counterbalance to the forces available to NATO. It can engage in territories which use the same
equipment as Russia (Georgia or Ukraine) but is in serious deficiency against the NATO air, sea,
missile and space equipment. The constant announcements of additional spending on the military by
Putin is generally not believed as the costs of keeping the troops on the Ukrainian border and taking
over Crimea used up much of the budget already.
THE MILITARY COSTS OF EASTERN UKRAINE
The Russian defence industry is almost totally reliant on goods produced in the Eastern Ukraine.
As the second largest exporter of arms with the worlds third military budget of $91 billion, Russia is
extremely dependent on Ukrainian supplies, which accounts for 87 per cent of its military imports,
according to the Stockholm International Research Institute.
The military-industrial complex of Ukraine is the most advanced and developed branch of the state's
sector of economy. It includes about 85 scientific organizations which are specialized in the
development of armaments and military equipment for different usage. The air and space complex
consists of 18 design bureaus and 64 enterprises. In order to design and build ships and armaments
for the Ukrainian Navy, 15 research and development institutes, 40 design bureaus and 67 plants
have been brought together. This complex is tasked to design heavy cruisers, build missile cruisers
and big antisubmarine warfare (ASW) cruisers, and develop small ASW ships. Rocketry and missilery
equipment, rockets, missiles, projectiles, and other munitions are designed and made at 6 design
bureaus and 28 plants.
A number of Ukrainian scientific-industrial corporations have started R&D and production of small
arms. The armour equipment is designed and manufactured at 3 design bureaus and 27 plants. The
scientific and industrial potential of Ukraine makes it possible to create and produce modern
technical means of military communications and automated control systems at 2 scientific-research
institutes and 13 plants. A total of 2 scientific-research institutes and 53 plants produce power
supply batteries; 3 scientific-research institutes and 6 plants manufacture intelligence and radio-
electronic warfare equipment; 4 design bureaus and 27 plants make engineer equipment and
materiel.
Perhaps the best example is the company Motor Sich. It is the sole producer of engines for the MI-8
and MI-24 helicopters. It produces these engines for the Russian helicopter industry and a wide
range of other military components. The air firm Antonov is based in the Ukraine and is one of the
major suppliers of aircraft for the Russian Air Force and for Russian arms exports. Russias state arms
exporter Rosoboronexport sold $13.2 billion in weapons and military equipment to foreign buyers in
2013. These arms deliveries in 2012-2013 included 13 An-140 and one An-148 transport aircraft.
The ability of the Russian industry to fill its own needs is compounded by the fact that it needs
Ukrainian parts and subassemblies for its exports. The Ukraine supplies the engines for the jointly-
produced AN-148 planes. Other exporters to Russia include Mykolayiv-based Zorya-Mashproekt,
which sells several types of turbines to Russia, including those installed on military ships. Another is
Kharkiv-based Hartron, which supplies the control systems for Russian missiles. The Yuzhmash plant
in Dnipropetrovsk is the only service provider for Satan missiles that Russia uses. The Ukrainians are
also the main supplier of spare parts which its armed forces desperately need.
Now, with the additional sanctions on the export of military equipment (and dual-use equipment)
from the West, Russias hopes to become self-reliant in the production of military equipment is a
fantasy. That is because the Russian economy has been starved of R&D money which has left its
technological capacity stuck at the starting point. In short the Russian military are about two
weapons generations behind the West, almost all of whom have developed effective counter-
measures against the aging Russian equipment. A retired Russian colonel said, when asked if there
would be a military conflict as a result of the Russian activity in the Eastern Ukraine he said No. Are
you crazy? Wed lose.
WHAT IS TO BE DONE?
In 1901 Lenin wrote a famous essay What is to be done in which he questions the future of the
Bolshevik movement. Many in Russia today are asking the same question, albeit of a different
flavour of Bolshevism Bonapartism. Putin has aroused the patriotic feelings of a Russian nation
which cannot come to terms with the fact that it isnt a world power; a nation which has to be in the
centre of international political engagements. For the most part Russia East of the Urals is a far
different country than the urban capitals of St. Petersburg and Moscow. There are many citizens of
Russia who dont really care what is going on in Moscow. Whatever news is broadcast it is rarely
good for the majority of its citizens and they know it.
More importantly the people who now occupy the positions of power in Russia are very different
than those they replaced. During the Soviet days many of those in the Russian intelligence services
and the military spent time abroad, working in Africa, Asia and Latin America. They were far more
cosmopolitan than todays office holders (One has to be very careful with the term cosmopolitan as
it was also used as an epithet against Jews).They had experienced other cultures, travelled in foreign
lands and brought back experiences which tempered the fervour of their ideologies. Many of the old
nomenklatura saw themselves as citizens of the world. The new nomenklatura are far more
insular. Their attentions are focussed inwards in an effort to win the favour of the siloviki and Putin.
It is mainly the oligarchs and the tourists who have travelled the world, with the oligarchs
understanding what they see. There is a new generation of Russians who feel that their
opportunities to become citizens of the world are hampered by the Russian political system. The
new sanctions imposed by Europe and America as a result of the Ukraine will stifle these hopes.
Mobilising the youth with patriotic slogans has its own limitations as failure to improve Russias
status will create doubt among even the true believers.
Many of the older generation of Russian soldiers are deeply resentful of the new system and fear for
their country as they know what bullshit is and what propaganda is. They know the weaknesses of
the military structure. The most important agent of change is the ability of ordinary Russians to
access foreign information on the internet. However hard the authorities may try to block it, is
transforming Russia. Despite the blanket of Russian domestic propaganda which fill the domestic
media outlets Russians have the ability, for the first time in generations, to acquire information from
outside the system.
So, as they contemplate the worldwide view of their country they are beginning to recognise the
outlines of Putins Potemkin villages and wonder about their future. Without major successes in
foreign policy it will be hard to maintain the level of fiction which has blanketed Russia. There is no
point in any military confrontation with Russia. To coin a phrase Putinism contains the seeds of its
own destruction.

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