Under Vladimir Putin’s control, Russia has reverted over the past decade to a society whose defining characteristic is the state’s control over information. The press has been suppressed, if not completely silenced, and the government-controlled media is ascendant.
As the Economist cleverly points out in its recent issue, the surest way to tell that there is an economic crisis in Russia right now is that there is no news about the economy on the television.
WHY THIS MATTERS
The path Russia takes in terms of its relationship with the West won’t have an immediate or direct effect on the United States. The U.S. trade relationship with Russia is, as a percentage of GDP, trivial. However, a Russia that continues to isolate itself would damage U.S. trading partners in Europe, and be a net negative for the global economy.
Related: A Desperate Putin Makes a Private Sector Power Grab
At a time when the country’s currency is plummeting in value and the government is contemplating huge spending cuts in order to keep its books balanced, media are treating the public to stories, such as this one from leading newspaper Komsomolskaya Pravda, about the Charlie Hebdo massacre in Paris.
It suggests (deep breath) that the United States orchestrated the attack in order to punish French President Francois Hollande for suggesting that international sanctions imposed on Russia for its invasion of Ukraine’s Crimean peninsula might need to be dialed back.
The strategy seems clear. By casting Russia as the victim of shadowy conspirators abroad, the Putin regime is able to make a case that current and future economic privation is the fault of Russia’s enemies and that Russians have a patriotic duty to come together in solidarity.
The Kremlin wants its citizens to replace their anger about their personal economic pain with nationalist anger about supposed attacks on Russia.
Related: Putin’s Woes Worsen as Russia-Backed Rebels Reportedly Kill Civilians
The question is: will it work?
Putin himself has been stoking nationalist fervor for months, repeatedly invoking the greatness of Russia in defending both his decision to send troops into Crimea and, more vaguely, Russia’s continued support for armed rebels in Ukraine’s east, who have used Russian weaponry in attacks on both soldiers and civilians. In his year-end press conference, he cast Russia as beset on all sides by enemies wishing to “stuff” the Russian bear.
To that same end, despite an announcement yesterday that the government was considering 10 percent across-the-board spending cuts, Kremlin officials made it clear that the one institution that would be spared is the Russian military.
Again, the effort is to play to the country’s pride and self-image – Russia as the global military power facing down legions of enemies around the globe.
Related: Oil Drop Further Rocks Putin’s Economy
However, while feeding the Russian people propaganda in order to get them to accept a second-world lifestyle was a relatively simple matter when Vladimir Putin was a young KGB agent, it may not be the case any longer.
A generation ago, for example, Russian citizens were subject to travel restrictions and the government exerted tight control over foreign media.
Recreating a Soviet-style system of misinformation in the 21st century, however, faces a few major roadblocks. The first, and most obvious, is the fact that information simply flows more freely across borders now than it did a generation ago, making it difficult to keep the Russian people in the dark about opinions – and facts – that conflict with the Kremlin party line.
However, as China and North Korea demonstrate, heroic efforts by the government can still shut down much of the traffic in information about the outside word.
Related: Fallout from Obama’s Russia Strategy Is Spreading Through Europe
More important is the fact that the Russian people have changed.
For generations prior to the fall of Communism in the 1990s, Russians saw little of the outside world. Young and middle-aged Russians today, though, have enjoyed a generation of freedom unknown to their grandparents. Foreign travel was common, and Moscow, rather than a drab city of state-run shops, at least until recently teemed with foreign luxury car dealerships, nightclubs, restaurants, and all the trappings of 21st century Western life.
In the 1980s, an ordinary Russian’s experience of the West might have been limited to his grandfather’s stories about driving the Third Reich back to Berlin through bombed out cities. In 2015, that experience is more likely to be memorialized in Facebook-posted pictures of his own Paris vacation.
Those memories won’t be erased, and will likely be top of mind for many Russians when they experience what economists are predicting for Russia’s economic future.
Related: Putin’s Government Jails critic’s Brother. Crushes Political Protest
The government, with dwindling income due to dramatic drops in oil prices, will slash spending on various services. More than most developed countries, government spending is a huge driver of the Russian economy, so the effect will be negative and pronounced.
According to former Russian Finance Minister Alexei Kudrin, the spending cuts will manifest themselves in declines in the quality of education, healthcare, and workforce training, all of which will exacerbate an economic decline and hinder a recovery.
At the same time, the Russian people will see resources flowing unabated to the military.
While this happens, ordinary Russians will likely continue to suffer. The value of the ruble is down by nearly half against global benchmark currencies this year, meaning that Russians’ savings has lost much of its purchasing power when it comes to foreign goods. Additionally, consumers are being squeezed by high inflation, which is further constraining their ability to buy goods regardless of their origin.
Putin promised that the millions of Russians living on government pensions need not worry, and last month he even promised a five percent increase in payments. However, with double-digit inflation, pensioners’ purchasing power will still be reduced, not increased, in the coming year.
Related: Putin’s New Storyline – Oil Shock Has a Silver Lining
This is not a recipe for public support, when the public in question has had a couple of decades to view the rest of the developed world as a generally welcoming place filled with opportunity for both profit and pleasure, not a capitalist hellscape.
Putin can try his best to convince Russians that going back to beet soup and bread lines is their patriotic duty, but it will be an awfully hard sell.
Top Reads from The Fiscal Times
- The Bond Market Is Warning of Huge Trouble Ahead
- How Obama Is Already Stumping for the Dems in 2016
- Biz Groups Make Congress an Infrastructure Offer They Can’t Refuse