MOSCOW — By normal standards Russia should be a happy and contented country. Moscow is awash with money, mostly flowing in from the giant energy sector and hugely boosted by the doubling in oil prices the past year. Shops and restaurants are booming. Cinemas and theaters are multiplying and play to packed audiences in expensive seats. Glittering new buildings go up everywhere, and cars jam Moscow’s wide streets.
The Russian economy is said to be growing 5 to 7 percent annually, far faster than the sluggish European economies to the west. The currency is healthy and inflation well under control. It is true that not all of this wealth reaches out to the poorer and more distant regions, but even in some of these, such as Tartarstan, 650 km to the east, the same spirit of economic and cultural vitality is bursting forth.
For millions of Russians life is good and, equally important, free, with the bad old days of Communism just a faint memory. Yet all is not well. A pall of pessimism hangs over Russia, with a mood akin to a mixture of injured pride and humiliation permeating the public debate.
The talk among Moscow thinkers and policymakers is of Russia being shut out of the modern world, Russia “losing” Ukraine, Russia being “rejected” by the European Union, and Russia being undermined on all sides by the Americans.
Russians look with deep apprehension at the huge American bases now established in neighboring Central Asian countries. They look at the unending instability and problems in these former Soviet territories, and they fear the fragmentation of the Russian Federation itself. They see terrorism and Islamic extremism on their doorstep and no understanding of their plight by the rest of the world.
This is especially so in the case of the bloody and yet unsettled rebellion in Chechnya, where it is feared that a break-away, if allowed, will set in train an unraveling of the vast patchwork of nationalities, languages and cultures that still make up Russia.
All this places those trying to govern Russia, headed by President Vladimir Putin, in an impossible position. They face a cascade of criticism, on one side from those who say they are not being tough enough, either internally or externally, and on the other side from those who say they are too tough and illiberal.
Nationalists want Russia to turn inward, be self-sufficient and re-assert itself as a great power. Even if the old Soviet Union cannot be rebuilt, they want a strong Russian sphere of influence embracing the surrounding states in which Russia has a free hand to “solve” problems, counter terrorism and maintain order.
Liberals want more freedom, more welfare, more sharing of the immense oil wealth now concentrated in the hands of oligarchs, more decentralization, and a wider spread of power.
The response of the governing elite has been to move in both directions by both bringing more power to the center and putting up more barriers against a hostile outside world while attacking the oligarchs head-on — as epitomized by the September 2003 arrest of Mikhail Khodorkovsky, the boss of the oil giant Yukos, and the subsequent breakup of his empire.
For foreigners, the most worrying move on the more nationalistic side has been the decision to exclude non-Russian controlled companies from bidding for the largest and juiciest new oil and gas concessions.
Russia is sitting on enough oil to rival Saudi Arabia and enough gas to keep Asia supplied indefinitely. In other sectors, the motor industry for instance, foreign investment has been welcomed. Almost daily, Putin and his colleagues call for more investment from overseas, but practice does not quite conform to speech. Everyone is left guessing whether the Russian economy is opening or closing. It is doing both.
The same ambiguity extends to domestic policy. Power has been called in from the regions — to the intense irritation of the richer and more successful ones — but with the implication that this is just temporary to help Russia get back on the right road after the disastrous policy mistakes of the early post-Soviet period, which were often founded on bad policy advice from the West. Welfare modernization has been attempted, although so clumsily that it has brought protesters into the streets.
Much of the negative thinking is aggravated by anti-Russian diatribes from Washington and the arrogant EU attitudes of seemingly insensitive and hectoring officials in Brussels.
The facts on the ground are more positive. Russia is emerging not only as the world’s major energy provider but also as a nation of brilliant designers, entrepreneurs and technicians.
As the center of global economic gravity shifts to booming Asia, the Russians could find themselves in a pivotal position between East and West, as suggested by the opening of oil pipelines and gas supplies eastward to the Pacific and to the markets of both Japan and China.
The friendliest advice to Russians today would be to count their colossal blessings and advantages in the new geopolitical scene and to worry less about government and governance at the center. The latter is bound to be a constant problem in a country as vast and diversified as Russia.
It is not government and the state, with all its attendant intrigue and inevitable corruption, but enterprise and the amazing Russian people who will lead the country’s full recovery after the dark years of the past.
Whatever they are told by overeager analysts and policymakers, whether in Moscow or the West, the world is with them and not against them. That means that despite all the fears and setbacks, the Russian future is very bright.
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