The dominant idea among many comments on Russia's regime change is that Putin wants to increase military efficiency by reducing corruption. But is this really the case? I would rather suggest that President Putin wants to redistribute the rents of his corruption to himself and his closest friends, increasing competition among nepotistic elites. Although he has no interest in ending wars, he seems to prefer eternal wars. My main guides are Vladimir Milov and Meduza.
Vladimir Milov's analysis begins with Putin's actual objectives. He is a thief and a dictator and has shown no desire for any of his successors. He is not interested in reducing corruption, but he wants the fruits of it to go to himself and his cronies. Since 2004, President Putin and his cronies Gennady Timchenko, Arkady and Boris Rotenberg, and Yuri Kovalchuk have been living off Gazprom funds. My late friend Boris Nemtsov and Milov were estimated to have embezzled a total of $60 billion over a four-year period from 2004 to 2007, primarily through no-bid public procurement and asset stripping. Their revelations caused the Russian stock market to crash in 2008.
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An excellent analysis by Sberbank in 2018 showed that the Putin group continues to tap around $15 billion a year to Gazprom. However, President Putin stopped this outrage based on high-priced exports to Europe by cutting Gazprom's gas exports to Europe from 153 billion cubic meters in 2021 to just 30 billion cubic meters in 2023. As a result, Gazprom suffered a net loss of $6.8 billion in 2020. 2023. Putin's whole theft scheme came to an abrupt end. What will Putin steal from this?
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UK Defense Information Ukraine Latest May 18, 2024
Latest information from the UK Defense Intelligence Agency.
Milov offers an obvious answer: procuring weapons. On Saturday, May 11, President Putin hosted his old friend Sergei Chemezov, who served in the KGB in Dresden in the 1980s, and appointed Chemezov as chief executive of the all-controlled state-run arms company Rostec. Chemezov arrived with the talented long-time minister Denis Manturov, who was promoted to first deputy prime minister for economic affairs the next day. Please note that Prime Minister Mikhail Mishustin was not invited to this important meeting.
Milov explains that 70% of the Defense Ministry's spending is on weapons procurement, half of which is controlled by the opaque giant Rostec. 20% goes to salary and up to 10% goes to discretionary expenses. Russia's military spending skyrocketed. Officially, the amount is $120 billion, but since 30% of Russia's budget spending is classified, Martin Klug estimates that it is probably not 7% of GDP, but 10% of GDP, or about $160 billion. ing. There is nothing more secretive in Russia than arms procurement, allowing Putin's faction to extract vast sums of money. Perhaps President Putin will allow Gazprom to procure weapons on his behalf to line his own pockets.
Putin appears to have never been involved in arms procurement before, and his unconventional business orientation necessitated a change in the Defense Ministry's vigilance to thwart former Defense Minister Sergei Shoigu's unwanted theft. . Mr. Navalny's Anti-Corruption Foundation has produced one excellent film about Mr. Shoigu's astonishing corruption, and another about Mr. Shoigu's blatantly corrupt lieutenant, Timur Ivanov. The FSB appears to be weeding out military leaders who steal more than expected.
I knew Russia's new defense minister, Andrei Belosov, well in the 1990s and early 2000s. At the Higher School of Economics, he belonged to a circle of liberal economists led by the late professor Evgeny Yashin, which also included Elvira Nabiullina, and among whom he was always the most Soviet figure. But he was soft-spoken, cautious, polite, and focused on politically neutral predictions. . I also knew his father, Rem (=Revolution + Engels + Marx) Belousov. He was a conservative Marxist-Leninist and professor of economics at the Academy of Sciences, and Andrei was a very loyal son.
Belousov is not a strong man. It is inconceivable that Mr. Belosov, a soft man with little executive experience, will clean up the huge and corrupt Ministry of Defense at the age of 65. Mr. Belousov's economic views likely suit Mr. Putin. Because while Mr. Putin likes centralized state planning, state ownership, and high taxes, he dislikes oligarchies. But above all Belousov is loyal to those in power – Putin. He may succeed in raising taxes in Russia with the support of President Putin.
Longtime Chief of the General Staff, General Valery Gerasimov, is likely to continue leading the war in the incompetent Soviet fashion of the past. His mediocrity may suit President Putin. He managed to avoid not only a Russian defeat but also a Russian victory, allowing Putin to use domestic repression to maintain his desired forever war. How many Russians die and how much the war costs matter little to Putin unless Russians rise up in defiance.
The big problem that most people overlook is that Putin is opting for more nepotism. Milov and Meduza saw it. What President Putin wants is not a successor to him, but competing nepotism camps that keep each other in check. Prime Minister Mikhail Mishustin remains in office, but his powers are limited. Instead, several nepotistic groups rose to prominence at the expense of meritocracy.
Chemezov and Manturov gained some strength. Nikolai Patrushev was dismissed as head of state security, but his son Dmitry was promoted to deputy prime minister and two of his aides were appointed ministers.
The powerful brothers Yuri and Mikhail Kovalchuk control Rosatom, most televisions, and many of Russia's banks. Their chief politician, former Prime Minister Sergei Kiriyenko, remains the first deputy in the presidential administration, and his team expands with new Minister of Industry and Trade Anton Alikhanov and Yuri Kovalchuk's son Boris as Auditor General. Ta.
The Rothenberg brothers acquired the position of Minister of Transport Roman Starovoit. The most attractive new appointee is Energy Minister Sergei Tsybilev, who is married to the ambitious Anna Putina, the daughter of Putin's cousin.
Although no clan has received Putin's blessing, all of Putin's cronies, with the exception of gas oligarch Gennady Timchenko, have gained representation in the government. This government appears to have been set up to promote nepotism and corruption.
The most important development may be that Putin has shifted the main target of embezzlement from Gazprom to other parts of the state, such as arms procurement and possibly construction. The leadership of the Russian Ministry of Defense is likely to be further weakened under Belousov, and the Russian military may become even more dysfunctional.
To ensure that no one can threaten him, President Putin is increasing competition between different groups within his government and engaging in corruption and nepotism more than ever. President Putin has already proven that he has no regard for the lives or well-being of Russians. Right now, he's hinting that he's more interested in the long game than winning.
The views expressed in this opinion article are those of the author and not necessarily those of the Kyiv Post.
