Victims of economic sanctions can shake Putin or Russian oligarchs

Victims of economic sanctions can shake Putin or Russian oligarchs. Since the invasion of Ukraine, Russia has been subjected to a series of economic sanctions from around the world, which have brought great changes to the lives of the Russian people. Although many people across Russia took to the streets to oppose the war and express their dissatisfaction with President Vladimir Putin, Putin’s biggest threat to domestic politics is more likely to come from the oligarchs and elites who control Russia’s economic resources and influence politics.

Victims of economic sanctions can shake Putin or Russian oligarchs

β€œIn our imaginations, the most important opposition to a regime would come from the lower classes. We were misled,” Thomas Remington, a professor of political science at Harvard University, told VOA. “The most important source and danger to the Putin regime, both traditionally and now, comes from within the elite.”

Economic sanctions-hit middle-class lives

Europe and the United States have used “financial nuclear weapons” to kick Russia’s major banks out of the international interbank transfer system SWIFT, separating Russia’s economic system from the international community. In addition, the sanctions have also frozen the assets of the Russian Central Bank.

These economic sanctions caused a sharp depreciation of the Russian currency, the ruble. 1 ruble is currently worth less than 1 cent. Inflation in Russia has also increased as a result. Many Russians lined up at ATMs to withdraw foreign currency from their accounts amid fears of bank restrictions.

The withdrawal of many Western multinational companies from the Russian market has also made the daily life of the Russian people more difficult.

United Parcel Service (UPS) and Worldwide Express and International Shipping Service (FedEx) announced the suspension of services in Russia. Microsoft has suspended new product sales and services in Russia. Apple has suspended sales of all products in Russia. Nike temporarily closed all stores in Russia. All IKEA stores are closed. Entertainment companies such as Disney have stopped selling films to Russia. Automakers such as Ford, General Motors, and Volvo have also stopped their operations in Russia, or suspended exports and imports to Russia.

“The situation (the middle class) is deteriorating very rapidly,” Remington said.

Dissatisfaction with Putin is growing

After Putin announced the invasion of Ukraine, protests and demonstrations of ordinary people appeared in Moscow and St. Petersburg. More than 8,000 protesters have been arrested, according to OVD Information, an independent Russian human rights organization.

Russian opposition leader Alexei Navalny, who is in prison, called on the public to stand up against Putin through a spokesman on his Twitter account.

“I call on everyone to take to the streets and fight for peace,” Narwani tweeted. “Let’s not be a nation of fearful and silent people.”

Former US ambassador to Russia Michael McFaul also revealed in a series of tweets that his Russian friends hope to use his voice to call on more Russians to stand up against the war and against Putin.

“The whole point of Western sanctions is to put pressure on Russian society — from students to oligarchs — to put pressure on Putin to end the war,” McFaul wrote.

According to the Levada Center, an independent Russian polling agency, Putin’s approval rating has remained above 60 percent for more than two decades. The latest survey in February showed that more than 70 percent of Russians supported Putin, and 60 percent of respondents believed that the United States and NATO had contributed to the deterioration of the situation in eastern Ukraine.

Nevertheless, Putin’s sudden war on Ukraine at the end of February without provocation shocked many people.

“Many Russians, especially educated and thoughtful people, are shocked, horrified, shocked by what the government has done,” Professor Remington said. “More and more Russians are aware of the profound cost [of the battle] to the Russians, including the poor soldiers who were drafted into the army, who were not even trained to do so, let alone what their mission on the trip was. what.”

Information blackout and institutional reliance limit dissenting voices

While dissatisfaction has risen, Russia has also stepped up its efforts to block information.

Putin signed a bill on Friday (March 4) that would punish him with up to 15 years in prison for spreading war messages that differ from what Russian authorities say. Earlier this week, the Russian authorities stopped the broadcasts of the independent media “Echo of Moscow” radio station and “Drizzle” TV station.

On Friday, Russia also blocked the websites of international media outlets including the Voice of America, the BBC, Free Europe, Deutsche Welle and others, accusing them of spreading “negative reports”.

The social media Twitter and Facebook were also banned on the same day.

Some Russians use VPNs to keep in touch with the outside world and see what’s going on. And those without a VPN, Remington said, are confused by the current situation. They may continue to support the Russian government, believing that the whole world is against Russia.

In addition to the different perceptions brought about by the Russian authorities’ information censorship, Russia’s economic model based on the public sphere also means that it is difficult for the Russian people to unite and rebel against the system.

Academia has long been unanimous about the share of Russia’s middle class in the population. Remington said in a 2010 paper that number could range from 5 percent to 52 percent, depending on how you define it.

In an interview with VOA, he said that 25% to 40% of Russia’s population is currently middle class. And if you take good income, living material standards and education as the standard, there is a “substantial” part of the Russian people who belong to the middle class.

“What’s characteristic of them is … many of them have deep ties to the government,” Remington said.

He said that many middle-class jobs are more or less related to the public sector, such as teachers, health care workers, civil servants, police, various government officials and so on. These people are unlikely to be “opposition minded bourgeoisie”.

Remington added that there is also a segment of the middle class who are entrepreneurs with an entrepreneurial spirit. But these people are increasingly dependent on the government due to the Russian government’s continued infiltration of the economy.

“A lot of the people we think are private businesses are also connected to the government,” he said, “because they need officials at the local or national level to give them favors.”

Oligarchs and elites or Putin’s biggest political hidden danger

Although the middle class makes up the majority of Russia’s population, oligarchs hold most of Russia’s economic resources and also have a greater say in the political arena.

Russian oligarchs generally refer to businessmen or former officials who acquired former state assets through corruption or private deals after the collapse of the Soviet Union. Acquiring a lot of resources, they quickly amassed wealth in Russia under private ownership. In the 20 years since Putin came to power, more people have become oligarchs because of their personal connections with Putin.

Credit Suisse estimated in a 2019 report that the top 10% of Russia’s richest population own 83% of the country’s wealth.

The oligarchs became the direct target of Western sanctions after Russia invaded Ukraine.

The U.S. government is developing a list of sanctions targeting Russian oligarchs. The United States, the European Union, the United Kingdom and Canada have formed a multinational task force to examine whether there are loopholes for Russian oligarchs to evade sanctions and to dig into the role of trust companies that help Russian oligarchs hide their assets. France and Germany have seized the superyachts of members of Russian oligarchs and billionaires, respectively, who are close to Russian President Vladimir Putin.

Targeted sanctions coupled with Russia’s crumbling economy, Remington said, make “more misery for those who enjoy a higher level of materiality.”

He believes that when oligarchs and national security figures continue to lose access to the economy because of sanctions, they will point the finger at Putin and his war. “Some people in the elite are going to be very dissatisfied,” Remington said.

But even if popular and oligarchic dissatisfaction does push Putin out of office, there is little hope that Russia will become more democratic, Remington said. This is partly due to the reliance of a large number of people on the existing system, and partly because the dissatisfaction with Putin is directed at the way he personally rules, not the authoritarian system as a whole.

“I don’t expect (the current grievances) to bring about a democratic bloom,” he continued. “What we might see is one dictator being replaced by another.”

Sunbal Razzaq

Sunbal Razzaq is the founder & CEO of Sunshine Tips.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button