The thesis that the “bottom” of the economic crisis may be close at hand has become very popular in recent statements by Russian politicians, who also tend to add that its consequences will be felt for another three years.

Supposedly, the crisis will peter out by 2012, that is, as if by a lucky coincidence, exactly by the moment when Russian citizens have to go to the polls to elect the president. Under the recently approved amendments to the Constitution, citizens and the political elite will elect the new head of state for six years, instead of four, as was the case before.

But this is not about a mere coincidence of the crisis timeframe with the election cycle. From the economic point of view, the crisis is unprecedented, and nobody can forecast precisely when it might end, either in the Russian or world economy. The thing is that Russian elites increasingly view the crisis and the prospects for pulling out of it as a serious challenge and a political project, albeit with unclear parameters but, in any event, with very significant consequences.

THE MAIN POLITICAL PRIZE OF THE CRISIS

The issue of the development of the political situation in Russia from the point of view of the political setup and the future of the government remains as pressing as it was before the crisis. It has been clear that as President Dmitry Medvedev’s term in office is running out day by day, the countdown to the event called “the next presidential election” where Vladimir Putin would be able to run again, will be clicking increasingly louder.

A partial Constitutional reform, carried out to increase the term of office for the State Duma and the president, has not changed the setup: rather, it has only made the countdown louder. The onset of the economic crisis has introduced certain new circumstances and inputs in the 2012 problem, which are just beginning to affect the strategy of behavior of the main influential groups and political leaders.

The first thing the crisis did politically was to raise the inevitable and crucial question for the 2012 elections, namely “Who has defeated the crisis?” Earlier, this circumstance was not factored in the calculations of the main contenders, who might only talk about “stability,” “further steady development, “higher standards of living,” “strengthening positions in the world” – in short, the promises or objectives whose political capital has much depreciated since.

The coveted new large political super-prize for victory over the crisis will be influencing not only the logic of actions, but also the psychology of political leaders’ behavior. The already started discussions about how large the current crisis is or how it can be overcome clearly indicate what the unfolding struggle is about.

The idea that the current crisis is purely economic and does not affect the groundwork of the socio-political system highlights the anti-crisis policy of the Russian government and the prime minister, as well as the economic indicators Russia will post in overcoming the crisis. A broader outlook for the current crisis, with prospects for economic restructuring, social modernization, and political innovations, draws one’s attention to presidential powers and Medvedev’s policy to fight corruption, improve the judicial system, and develop civil society institutions.

The person who will win the 2012 election will simultaneously be hailed as “the victor over the crisis,” with all political advantage it packs and resource for further actions.

This point is extremely significant, because the second new and important input of the crisis is that a change in the setup of forces in the economy, partial re-division of property and the reshuffle of political elites is objectively becoming a key process for the next few years. The normalization and re-capitalization of the strategic assets of the national economy will take some time, and this time can conveniently match the announced three-year period before the end of the crisis. Then, as the country is pulling out of the crisis and during the period of the six-year presidency, a new “agenda” will be set, including new privatization, the formation of a new durable structure of property in the economy and its new image or, rather, a collective portrait of these proprietors.

Undoubtedly, this process will heavily involve politics and reshuffles in political elites. For example, regional Russian elites are incurring potentially the largest crisis-incurred losses, aside from companies and prominent business leaders.

The unequivocal and reiterative statements by the federal authorities about the poor effectiveness of regional leaders in fighting the crisis, along with increasingly frequent resignations by regional leaders is a clear signal of what level within the authorities has been assigned to bear the main political and personal responsibility for the crisis.

The current crisis has brought the principles of the existence of regional elites and the federal center’s regional policy to a certain landmark, which might put an end to the rather extended period of their existence. It has been dragging on since the beginning of the 1990s, despite the seemingly varied and significant turns of events in subsequent years. At that time, the bargaining between regional elites and the federal center along the lines “effectiveness and stability in exchange for political loyalty, de-centralization and economic resources” was usually successful, although sometimes it ended up in claims for sovereignty or, worse, separatism, as in the case with ethnic republics. The default of 1998 consolidated part of regional elites who aspired to establish their own control over the federal government. The necessity to counterbalance the situation not only resulted in Vladimir Putin’s coming to power, but also pre-determined the main guidelines and elements of his program to build the so-called vertical of power in the “zero years,” i.e. the first decade of the new millennium: from federal control over inter-budgetary relations and the fight against secessionist trends to the re-distribution of government powers in favor of the federal center, and, lastly, the cancellation of direct gubernatorial elections.

However, the bargaining continued to remain the framework for all possible changes in relations between the federal and regional elites. Regional elites kept swapping their political loyalty and making concessions by yielding some of their powers to Moscow for the opportunity to remain in office and draw economic and administrative annuity from their respective provinces. The recent “fat years” contributed to the success of this strategy, mostly free of conflicts, when a surplus of resources and opportunities to develop them provided for co-existence on more or less amicable terms.

And again, the economic crisis and the ensuing shortage of funds has changed the situation. Unlike the late 1990s, regional elites have no serious opportunities to pursue a political or economic game of their own, which is the main achievement of the centralization policy in the “zero years.” The federal authorities therefore can either impose the main “tax” of political costs on regional elites during the crisis and then return to the previous relations, or renounce the present model of “federalism of intra-elite bargaining” in favor of some new principles of regional policy.

Conceivably, the leader who will claim “victory over the crisis” will have a resource for reconfiguring the political and economic setup in the country.

THE FATE OF THE TANDEM

The question about the victory and victor in the crisis lends a new tonality to the discussion about what will happen to the political model of the “tandemocracy” of President Dmitry Medvedev and Prime Minister Vladimir Putin, which has formed after the 2008 presidential election.

As the new political model began to function, it was generally assumed that Putin was still undecided on whether the political system he had built and the team he had formed would be able to work effectively without his direct supervision and “manual control.” In short, he was not certain if he would have to seek another presidential term.

To keep this option open, Putin became prime minister and leader of the United Russia party. This also gave him room for maneuver and political initiative. During Medvedev’s term in office, Putin could have more insight into the situation, and convert his premiership and party chairmanship into an instrument to implement one of the three possible scenarios.

The first scenario envisions Putin’s role as a protector and a “safety mechanism” for Medvedev. He will gradually introduce him to the ins and outs of presidency and transfer to him, step by step, an increasingly large volume of real powers and functions. After completing this “gradual succession” program and Medvedev’s re-election in 2012, he may resign the post of prime minister but remain the leader of the ruling party.

Under the second scenario, things may take a turn for the worse within the next few years, and it will become clear that the risks inherent in the poorly controlled system are too great, while external challenges and socio-economic threats are considerable. In that event, the post of prime minister makes a good floor for Putin’s comeback as president, who might even return early, in case of contingency.

The third scenario suggests that the system of de-centralization and power-sharing between Medvedev and Putin will prove effective and help forge a consensus among elites and the public that this new form of government in Russia should acquire legislative underpinning, perhaps, by partial Constitutional reform (which would include not only the already adopted amendments but also certain additional specifications of the power-sharing system). It would not imply permanent diarchy or transfer to a parliamentary republic but, rather, a full-fledged institutionalization of a sort of “French model” of  the balance of forces, powers and responsibilities between the presidential and government powers, with reliance on parliament and the system of political parties.

Today, a year since President Medvedev taking office and forming a tandem with Putin, none of these scenarios can be discarded, but, at the same time, none is given a final preference.
One might say the Medvedev-Putin tandem started up and covered the first 100 meters of the track, but the finish line is yet far off, especially because we do not know what distance they are running. The economic crisis is an extra complication in this situation: perhaps, they are not just runners but decathlon competitors facing shotput, pole-vaulting, and javelin throwing, in addition to hurdling.

There is no complete clarity, and on top of that, new uncertainties have emerged.

On the other hand, one might be reasonably certain that the scenario options will exist until a principled political decision has been made on who will run in the 2012 presidential polls: Dmitry Medvedev or Vladimir Putin. The decision should be due before early 2011 and the start of preparations for the parliament election campaign.

But for now, the tandem situation will be quite stable. It will be developing under the pre-set and easily seen rules. There is a rather clear-cut division of the spheres of influence and areas of activities between the president and the prime minister. Each has the right of initiatives and the right of priority in governance and decision-making in his respective field.

However, a sort of a “tandem veto system” has been formed as well: Putin can block any presidential initiative, while Medvedev, as the head of state, can scrap any actions by the parliament or government, on the strength of his Constitutional powers.

The parties do not abuse their “veto powers,” because only the two of them within this model will always have a controlling stake in the political system. This means that the “two keys” principle will be applied to the broadest possible range of powers of the president and the prime minister: consent of both is essential on key decisions or their implementation. Hence the rules of the games in the “power tandem” system are so arranged that the point of balance, at least in the absence of force majeure, is reached not through the maximum weakening or strengthening of one of the diarchy partners but through parity between them, which provides, among other things, for curbing the ambitions of the teams lined up behind each leader.

On top of that (perhaps, this is the key point), neither President Medvedev, nor Prime Minister Putin are interested in any weakening, belittling or discrediting the very institution of presidential power in Russia. For the incumbent president, it is more than obvious. For Putin, it is logical, too, because the prospect of his return to the office of president cannot be ruled out.

What the ongoing economic crisis makes inevitable (given the above new main prize of “victory over the crisis” in the 2012 polls) is that the “tandemocracy” system is unlikely to survive after Medvedev’s present term.

In the long run, it will remain a purely interim form either before backtracking to the old mono-centrist and personality model of monopolistic presidential power, or before an accelerated transfer to a new stage, including Constitutional changes in the system of power balance and power-sharing between the branches of power in Russia.

The development of the situation under the second option would imply that the Russian political elite is ready to give up for good the model of a political mono-centrist, super-presidential republic, in order to keep their positions and stability for a long while. They would wish to eradicate the fundamental problem of complete change of government in the present system – the necessity to carry the risks of possible monopoly over power by one person, regardless of who he is.

If the present tandem eventually achieves greater institutional certainty for the political system, it will be one of the main positive achievements of Medvedev’s presidency, especially because the political system, most likely, should become more complex and less unequivocal in institutional terms, if we mean a large-scale socio-economic modernization of the country and a more sophisticated structure of society and social interests.

PROBLEMS OF THE NEW “PUBLIC ACCORD”

In the evaluation of the prospects for political processes in Russia in the next few years, an increasingly important role is played by not so much the political process within elites, its ramified scenarios and “road maps,” as the dynamics of social processes amidst the crisis.

Today, the discussion that any society has a private public accord (which finds itself under threat in the conditions of collapse of the world economy) is gaining momentum and topicality. The future will depend both on the force of the economic blow delivered at a given country but, mostly, on the nature of its political system and specifics of this very public accord.

The Russian political model of the “zero years” has never been tested by economic crises or downturns before, although it did function under quite low prices of oil and a low volume of annuity, quite similar to what we have at present. In other words, the most important thing for its political stability is an upward trend or its absence, not the economic situation at any given point. It is not about a snapshot of current problems or achievements, but a positive or negative image of the future. Hence, the legitimacy here largely depends on the ability to sustain economic growth rates.

It does not imply complete dependence on the factor of growing welfare; there are other points here, which might have even more significance. Alongside the flourishing price situation, the Russian political system of the “zero years” model was functioning quite successfully, resting upon the high popularity of the incumbent government. Both factors are significant, but popularity is of primary importance and plays a large role.

The ratings of the top authority have essentially been (both during Putin’s presidency and the current “tandemocracy”) the ratings of expectations and hope. Today, despite the dramatic fall in the indices of citizens’ opinions of the socio-economic situation, the level of confidence in the government is still high. To be more precise, it is high in a new way, because the ratings are still based on expectations and hope, but the novelty is that the government now must ensure the least painful way of pulling out of the crisis.

In addition, the government would be expected to secure a fair anti-crisis strategy and its effectiveness. The margin of political strength and stability of ratings are determined not by the intensity of economic problems, but the perception by the nation of whether or not the anti-crisis strategy is fair. A protest can flare up if this bid for justness is ignored. As for economic problems, the state is rather expected not to interfere with people’s efforts to survive.

This situation is quite traditional for the modern Russian society, because the requirements for order and justice in people’s mentality have played and continue to play the leading role. At the turn of the 1990s, it was obvious because of the war in Chechnya, the threats to the country’s integrity and the prevailing public resentment of the results of the “decade of privatization and reforms” as unfair. The “public accord” at the turn of the 1990s and the “zero years” was made between a large part of the population and the top authorities in circumvention of a considerable portion of elites, so that the top officials, backed by the masses and high ratings could act in their own right to “restrain the modern aristocracy.” This explains the overly positive attitude by the larger portion of the public to the infringement upon the rights of regional elites or oligarchs.

An addendum to the “public accord” covering better welfare, made during the late “fat years,” was certainly motivated by an exchange of political rights for a better standard of living. This is not surprising. Given a very low level of confidence in market institutions and economic and political competition in the Russian society, the main demand to top government has been a paternalistic attitude, providing for a large public share in annuity and its subsequent distribution in the society. This would prevent the elites from limiting “ordinary people’s” access to the deriving of profit from annuity flows. Whether or not this situation has changed much during the crisis is a big question.

However, there is a factor that can considerably influence the social dynamics and sentiments; this is the factor of time. Nearly all sociological polls show that the society is ready for a crisis lasting another year or so. There is a certain margin of strength of government reserve funds, accumulated reserves and adaptation of households to tide Russia over this period.

The prospect of “a three-year crisis” until 2012, though viewed by the authorities as a benchmark of political strategies, would seem a very bad scenario, from the point of view of economic and social costs.

In effect, the hidden hope for “a short-term crisis” still prevails in the public mind and the outlook cultivated by elites. If these hopes come true, the post-crisis Russia of 2010-2011 will differ little from what we saw just before 2007-2008.

In the political sense, the country, led by the incumbent authorities to the victory over the crisis, will be preparing for relatively quiet elections. It is important that the very issue of the main candidate to the presidential post in 2012 will be addressed outside the framework of the crisis. The theme of modernization and other novelties will continue to be topical, but these will again be implemented amidst the titanic struggle against the inertial “let-everything-run-its-natural-course” logic, and in the nearly same configuration of political, clan and group social interests we have now.

In these conditions, it is the possibility of a longer and deeper crisis that increasingly becomes the decisive factor in further development of the situation in the country and its sharp turns. An infinite duration of the crisis is the worst hitch for both elites and the population. If the “long crisis” in Russia not only becomes a reality but also sours the mood of the elites and the population, it may bring about a “radical turn” in the socio-political situation and actions by various political players.

In that event, a dramatic change in the political agenda and economic policy, as well as a reshuffle of elites will become possible. Early federal elections cannot be ruled out, either. And then the victory will go to a political force or a leader that will come forward to state their position precisely at the moment when the hand of the barometer of public and elite’s sentiment inclines towards the segment marked “severe and drawn-out crisis.”