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By Sean — 3 years ago
The consensus around Russia’s ban of food imports from the US and EU is that Russia is only hurting itself. As a NY Times editorial, aptly named “Russia Sanctions Itself,” stated, “No doubt many producers in these countries will feel the loss of $30 billion in food exports to Russia, but the overall effect on their large and diversified economies will be marginal. Russia, by contrast, imports about 40 percent of its food needs in terms of value, and the Russian agriculture minister has acknowledged that the sanctions would cause a spike in inflation.” If this is the case, then what’s Putin’s strategy behind the food ban?
Writing in Slon, Maksim Samorukov takes a stab at Putin’s possible strategy. In 2013, the EU exported 10.5 billion euros of food to Russia, about 10 percent of its total agricultural exports, making it the second largest market after the US. It’s a growing market, Samorukov states, because Russia imports three times more from Europe than it did ten years ago. Moreover, these exports are important to balance trade in Russian oil and gas. Nevertheless, 10.5 billion euros doesn’t seem like a lot when spread over 28 EU countries. Nevertheless, some countries will be more affected than others as this chart shows.
And this is perhaps what Putin is banking on. Europe’s agricultural lobby will put pressure on their governments and countries like Spain, which has the most to lose with Russia’s food ban, will break the solidarity of the EU. It’s wishful thinking, for sure, but here’s what Samorukov argues:
- The food ban will hit European farmers, and their discontent might force governments to weaken their resolve. Samorukov writes, “Farmers in Europe are very organized people, with extensive experience in lobbying and a tradition of organizing mass demonstrations at the slightest threat to their welfare. You can always find a group of fishermen or peasants at the official European Union buildings in Brussels expressing their indignation at the next food policy. And if it comes to any major changes in agricultural policy, then there is bound to be a crowd of many thousands. . .” Moreover, these farmers will have the sympathy of the population, adding to the political pressue. Putin is essentially counting on European democracy to work in his favor.
- The EU’s pocket book is squeezed on both sides. There’s the “pampered” farmers in western Europe that refuse to accept any reduction of agricultural subsidies on one side, and the poorer famers from eastern Europe on the other. Until now, according to Samorukov, famers in the east were getting fewer subsidies than their counterparts in the west. But now the EU will have to pay those famers equally to alleviate the pain of the Russian food ban. “A unified EU budget, where agrarian subsidies make up almost half of expenses, cannot support such a burden.” Putin, therefore, is hoping that the EU financial woes will play to his advantage as well.
Russian ban on European food seems to have been invented in the hope to take advantage of these difficulties in the EU’s agricultural sector and try to split the unity of the Union. For example, the countries of southern Europe, that have little enthusiasm for sanctions against Russia, joined the them solely to not betray European solidarity. And now the imposition of sanctions would mean they would not only have possible problems with the flow of tourists, but also tangible losses to their already problematic and large agricultural sector.
Samorukov, however, doubts this will work:
The Kremlin certain in its cynicism, as usual, underestimates the principles of Western leaders and their willingness to make sacrifices for the sake of the idea of European solidarity, especially when it comes to such lawlessness as the revision of the borders. But still the impact on agriculture was the best choice from the viewpoint of the proportion of losses and effect.
There’s also the shooting down of MH17 by Russian backed separatists. This changed everything, and explains Europe’s suddenly discovered resolve.
Though Samorukov doesn’t make the argument, I think there’s a possible third idea behind Putin’s thinking: the long term goal of reducing Russian dependence on the West. This project of import substitution coincides with the nationalist fervor that has characterized Putin’s third term. In the short term, Russia will likely increase its exports from places like Brazil. In the long term Putin is banking on the food ban to invigorate Russia domestic agricultural production. Russian consumers will certainly feel the pinch of this policy, but as Samorukov states, the Kremlin can reassert that Russia is a besieged fortress and its people must sacrifice for the sake of sovereignty. But this mobilization can’t last forever. The question is whether Putin’s strategy will pay some geopolitical dividends before the nationalist mobilization peters out.Post Views: 180
By Sean — 10 years ago
(Top down, left to right: Vladimir Putin, Prime Minister; Viktor Zubkov, First Vice-Prime Minister; Igor Shubalov, First Vice-Prime Minister; Igor Sechin, Vice-Prime Minister; Sergei Sobyanin, Vice-Prime Minister; Sergei Ivanov, Vice-Prime Minister; Aleksei Kurdrin, Vice-Prime Minister; Aleksandr Zhukov, Vice-Prime Minister; Sergei Lavrov, Foreign Minister; Rashid Nuraliev, Minister of Internal Affairs; Aleksei Kudrin, MInister of Finance; Sergei Shoigy, Minister of Public Safety; Dmitri Kozak, Minister of Regional Development; Tatiana Golkova, Minister of Health and Social Development; Elvira Nabiullina, Minister of Economic Development; Anatolii Serdiukov, Minister of Defense; Igor Shchegolev, Minister of Communications; Andrei Fursenko, Minister of Education; Iurii Trutnev, Minister of Natural Resources; Aleksei Gordeev, Minister of Agriculture; Sergei Shmatko, Minister of Energy; Viktor Khistenko, Minister of Industry, Vitalii Mutko, Minister of Sport; Aleksandr Avdeev, Minister of Culture; Igor Levitin, Minister of Transportation; and Aleksandr Konovalov, Minister of Justice.)
Things to note are:
Putin basically brought his tail from the Kremlin into the White House. The top faces should be familiar to anyone paying attention. The number of Vice Prime Ministers was raised from five to seven. Shubalov’s promotion and Kurdin’s double role as Finance Minister and Vice-Premier is being viewed as a liberal bulwark to hawkish Sechin and Ivanov. Dmitri Babich notes that all seven men owe their careers to Putin and four of them (Ivanov, Sechin, Zubkov and Shuvalov) are his personal friends.
Two big figures in the “siloviki war” Vikor Cherkesov and Nikolai Patrushev have been removed from their respective positions as the head of the Federal Drug Control Service and the FSB. The former will now head the federal agency for buying military hardware. The latter will become the head of Medvedev’s Security Council.
The Moscow Times sees this shuffle as an overall blow to the siloviki. So does Yevgenia Albats, who told the Indepdenent‘s Shaun Walker that “The appointments suggest that the warriors have lost and the traders have won.”
Despite the fact that the government looks stable, Jonas Bernstein evaluates the expectation that the Medvedev-Putin tandem will at some point collapse.
The New York Times’ C. J. Chivers predictably sees the appointments as yet another move to “retain a grip on power and the direction of policy in Russia.” Like the Moscow Times he makes much of the fact that Putin sat in the same seat as he did as President, while Medvedev sat in a seat “viewers have come to regard as one for subordinates.” Reuters is also making much of the chair. Lyndon over at Scraps of Moscow simply calls the chair thing “stability.”
Equally predictable, RFE/RL sees the cabinet with so many familiar faces as the “preservation of power.” Wasn’t that the point all along?
Not all are winners though. Sergei Ivanov, who was once a presidential hopeful was demoted from a First Vice Primer to a simple Vice Premier. Communications Minister Leonid Reiman and Justice Minister Vladimir Ustinov have to hit the pavement and find new jobs. I doubt the revolving door between the Russian government and Russian corporations will make job hunting difficult.
Medvedev has appointed former Deputy Prime Minister Sergei Naryshkin to be his chief of staff. He also promoted Head Putin ideologist Vladislav Surkov to first deputy chief of staff and elevated another Putinite, Alexei Gromov, to be deputy chief of staff.
Few new faces were brought into the Putin’s government or Medvedev’s administration. For the most part things look like they did before. Economic liberals are balanced with security minded conservatives.
I don’t imagine any major conflicts, or at least no more than usual among the elite. The board of Kremlin Inc. is continuing with business as usual. Let the plundering resume!Post Views: 50
By Sean — 9 years ago
A few weeks ago, Dmitry Medvedev announced that Russia’s top officials would reveal their incomes as part of an anti-corruption campaign. When I heard this I wondered whether that disclosure would include any of the money they’ve most likely picked up over the last eight years. After all, Medvedev was the chair of Gazprom’s board of directors, and one would suspect he was compensated heavily for his service. However, when he stated his finances for the presidential election, Dima was pretty much broke by American power player standards. Since 2007, Putin has been rumored to have a hefty $40 billion squirreled away in some unknown bank account.
The tandem released their incomes today, and one can only assume that while Medvedev and Putin might have earned $124,000 and $137,000 respectively, I seriously doubt this is the full number and certainly not full disclosure of their wealth.
Both men earn over 18 times Russia’s average wage of 230,000 rubles per year.
Medvedev has the larger apartment, a 368-square-meter Moscow residence that dwarves Putin’s 77-square-meter flat in Saint Petersburg, the declarations showed. But both men spend most of their time in their palatial state residences.
. . .
Putin also owns a garage, two classic cars, a trailer and a 1,500 square meter plot of land, his declaration said. He also has share holdings with a nominal value of 230,000 rubles.
Medvedev and his wife have bank deposits worth just under 3 million rubles and 4,700 square meters of land. His wife has two car parking spaces and a Volkswagen Golf.
It’s interesting that Putin, as Prime Minister, earns more than the President. But not by much.
Perhaps, what is more interesting is how Medvedev’s salary compares to that of other world leaders. Barack Obama tops the list with a paycheck of $400,000 a year. But this is chump change compared to the $4.2 million Obama earned from book sales in 2007. And now with his own full fledged cult of personality, Brand Obama is a potential bottomless well of profit.
Obama’s high is followed by Ireland’s Brian Cowen who rakes in roughly $380,000, France’s Nicholas Sarkozy’s $355,000, Angela Merkel’s $337,000; and Britain’s Gordon Brown who gets $294,000.
Poor (that is for reported income) Dima is in last place with an annual Presidential salary of $99,000.
As we all well known public office isn’t what pays. What really pays are the connections, greasy handshakes, and back room dealings. I suspect this is how the Clintons earned $109 million (which I also doubt is full disclosure) from 2000 to 2007. And once that government-corporate revolving door begins to spin after leaving office, look out. Pay-dirt. When they finally leave office, I’m sure Putin, Medvedev, Obama, Merkel, Sarkozy, Brown, and Cowen will be amply compensated for their time.Post Views: 122