April 13, 2022
How Ukraine missed its “chance”
Look at Belarus
Gloomy forecasts
He believes in this plan
He had a dream
Budget is strong
Control over minds
Jail - is a universal receipe
Easy way to avoid the war
Ukrainian President Volodymyr Zelensky announced the detention of MP Viktor Medvedchuk. Medvedchuk was charged with high treason and placed under house arrest a few months ago. On February 27, the fourth day after Russia invaded Ukraine, he fled and hid near Kyiv. Vladimir Putin is the godfather of Medvedchuk’s daughter and, seeing him as a pro-Russian politician in Ukraine, has supported his political activities.
Since the Orange Revolution, the Kremlin has believed that pro-Russian sentiment in Ukraine is powerful. A pro-Russian candidate has a great chance of winning the presidential and parliamentary elections. Initially, the Kremlin saw Viktor Yanukovych as such a politician, and after he was ousted as President in February 2014, Medvedchuk took over. With him, the Kremlin had pinned its hopes on a voluntary transition of Ukraine into Russia’s sphere of influence. This was acknowledged today by Putin’s press secretary, Dmitry Peskov, who said that “Medvedchuk has always been for peace, opposed war, opposed the expansion of the conflict in Donbas... If these ideas of his and his party had been considered or formed the basis of Ukrainian state policy, there would have been no military operation.”
At the same time, neither Medvedchuk nor his party enjoyed broad support in society. On the eve of Ukraine’s 2019 presidential election, he was not among the 10 candidates that voters were willing to support. Before the parliamentary elections the same year, his party, For Life, did not gain more than 3% in the polls and had no chance of being represented in Parliament (the threshold was 5%). As a result, Medvedchuk’s party merged before the elections with another pro-Russian party, the Opposition Platform. The new entity received 13% of the Ukrainian vote, and Medvedchuk entered the Verkhovna Rada on the electoral list, refusing to be elected in a single-member district.
Meanwhile
While the attention of politicians and experts is riveted on the events in Ukraine, Russia has de facto occupied Belarus, stationing its military group there permanently, and gained control of the Belarusian armed forces. This process took place as part of the deepening integration of the Union State, based on a separate agreement signed last fall.
Today we can speak of a specific political structure in Belarus, in which the President controls all the levers of power, except for the Ministry of Defense. This arrangement suits both leaders, Lukashenko and Putin. The former is guaranteed to be in control and enjoy financial support from Russia. The latter has ensured Belarus’ complete loyalty and guaranteed himself peace of mind from a repeat of the “Ukrainian nightmare”—for too long, Lukashenko tried to balance between Russia and Europe, and at times it seemed that he could abandon his ally in the East if he was offered an acceptable price.
Now Lukashenko is firmly tied to Putin, and the Russian army will not let the Belarusian leader choose otherwise. This was once again demonstrated during Monday’s meeting between the two dictators, when each deemed it necessary to dwell on their partnership, speaking at a press conference. If Putin was cautious enough, saying…
[we] discussed the formation of a joint defense space and the security of the Union State. We analyzed measures to protect Western borders and the progress of military-technical cooperation.
…Lukashenko called everything by its proper names
You know, “junior” and “big brother” have created a common grouping, a joint army in the West... And they [Western politicians] didn’t know that we have a joint army? I didn’t hide it. On the second day of Russia’s operation in Ukraine, I explicitly said about our functions in that operation. Remember, I said: We will not allow anyone to shoot a Russian man in the back—and that was the essence of our process, our participation in this operation... we see how the Americans are pushing not only Ukraine but pushing our Western neighbor Poland and the Baltics to confront Belarus. So the “younger brother” in this situation, if necessary, the “big brother” will help. This is the point, not that the elder brother is everything, and the younger one can do nothing.
No panic yet. But…
The Russian authorities try by all means to conceal data on the state of the economy, but this can be done only for a short time. The persistence of imitation democratic institutions forces officials to talk about what is going on from time to time.
Speaking to the Federation Council on Tuesday, First Deputy Prime Minister Andrei Belousov gave his first assessment of the shrinking economy. According to him, “in industry and trade the decline in production was about 11%; in other sectors it was 9%-10%.” Belousov says this evaluation is based on surveys of the heads of enterprises. Therefore, the official review of the results of March can be very different for the better. But even a hypothetical minus 5% in one month, when most of the sanctions restrictions have not yet started working in full force, indicates that the Russian economy is facing challenging times ahead.
Continuing Belousov’s words, Alexei Kudrin, chairman of the Accounts Chamber, gave a very gloomy forecast for the coming months.
Of course, our economy will have to rebuild; it seems necessary to separate the medium and long-term period. If the sanctions remain at the same level as now, then [to restructure the economy, form a new equilibrium] will take about two years, no less. I would say that this is the first stage, and then we will have to rebuild for many years because we are talking about the import substitution of several goods.
There was a plan
Meanwhile, Vladimir Putin has felt called upon to lead the economy once again, as he did in the 2008-09 crisis. Today, his spokesman Dmitry Peskov said that Putin intends to hold a whole series of thematic meetings to address the problems of various industries. The first meeting will be held tomorrow, and it will be devoted, not surprisingly, to the issues of the oil sector.
But before the wave of current problems overwhelms him, he has decided to hold a meeting on the development of the Arctic, to which he pays a great deal of attention. On the one hand, it is understandable: The Arctic is rich in natural resources, and the Northern Sea Route can potentially create a global transport corridor, taking away some of the traffic and income from the Suez Canal. On the other hand, projects to develop natural resources at current prices do not look attractive. The sanctions imposed on the Russian oil and gas sector may make unrealizable even those projects that were already beginning to take shape only two months ago.
Speaking at the meeting, Deputy Prime Minister Yury Trutnev radiated confidence and optimism:
Four companies, “NOVATEK,” “Gazpromneft,” “Rosneft,” and “North Star,” should provide the bulk of the traffic along the Northern Sea Route until 2024. If these companies fulfill their plans, transportation along the Northern Sea Route to 2030 will exceed 200 million tons.
…which I’m not ready to share today.
He had a dream
Two weeks ago, Vladimir Putin issued a decree demanding converting payments for gas exported from Russia into rubles. This initiative came as a surprise even to his inner circle, including Gazprom. To fulfill the President’s dream, Gazprom should negotiate with European gas consumers about changing the terms of the contracts. But until today, the company has not even been able to formulate its negotiating position and offer it for discussion to its contractors.
A spokesman for the German economy and climate protection ministry told a briefing on Wednesday: “The Russian President has instructed Gazprom to develop precise rules. They have not yet been presented.”
Budget is still strong
The war in Ukraine and Western sanctions have had no visible impact on federal budget execution. Some experts talk about a decrease in customs duties amid difficulties with imports, but my assessment of the situation does not confirm it: In 2018-2021, in March, there was traditionally a decrease in customs duties collections; this year’s reduction was less severe than before.
The war had no noticeable impact on budget expenditures under the section “National Defense”: In the first quarter of this year, 1.054 trillion rubles were spent on this purpose, which is 11% more than last year. Though the annual defense spending this year increased by 2.8% compared to 2021, we should consider that the Finance Ministry does not separately disclose current defense spending and spending on arms purchases, so the increase in military spending may be due to a change in the payment schedule for armaments.
Of course, budget statistics react to changes in the economic situation with some lag, so more reasonable conclusions can be drawn only at the end of the second quarter. In addition to the fact that tax payments in Russia are tied to quarterly reporting, this year, the government has allowed companies to switch to paying taxes based on the month’s results, which will make the data from April and May incomparable with previous years.
Total control
The Meduza project published the results of an investigation that suggests that a government global information monitoring system, including social media, has been operating in Russia since at least the fall of 2020, aimed at “identifying points of tension.” This system is used by Roskomnadzor, the media censor; Roskomnadzor transmits its monitoring results, for Russia as a whole and individual regions, to the presidential administration, the Federal Security Service, and regional governors.
As understood by the Kremlin, tension is manifested in the number of publications which:
give a negative assessment of President Putin,
criticize the Russian authorities,
compare the standard of living in Russia and other countries,
highlight the activity of non-systemic opposition,
discuss sanctions pressure on Russia,
discuss the possibility of increasing the role of regions in Russia and the division of the country,
discuss religious and national conflicts,
discuss antimilitarist slogans,
discuss sexual and other “freedoms”, and try to impose tolerance,
discuss the possibility of legalizing soft drugs,
criticize Russian aggression and meddling in the internal affairs of foreign states,
discuss the events of World War II beyond the framework outlined by the Kremlin.
Graffiti? Go to jail!
On April 11, artist Sasha Skochilenko was detained in St. Petersburg and accused of spreading “knowingly false information” about the Russian Armed Forces. This charge could result in a fine of 3 million to 5 million rubles, compulsory labor for three to five years, or imprisonment for five to 10 years.
Skochilenko was detained based on a denunciation to the police by a female customer in a store, who found anti-war graffiti instead of the artist being found by cameras installed in the store.
Today a court in St. Petersburg sent Skochilenko to custody until May 31. The judge, when announcing the measure of restraint, noted that Skochilenko could abscond and destroy evidence in the case, that she does not reside at her place of registration, and that she has “a sister in France,” “friends in Ukraine,” and “a friend in exile.”
Sasha Skochilenko is the author of the comic book “The Book of Depression,” translated into Ukrainian and English.
And to think I have many friends who actually continue to defend Russia... The treatment of Sasha Skochilenko is just one of many serious human rights abuses of this ridiculous government.