Putin's Winning Streak Will Be Hard to Extend
One might expect Russian President Vladimir Putin to take a victory lap after a lucky 2016. But at his traditional end-of-year press conference on Friday, Putin looked more tired than triumphant. He also appeared eager to steer attention away from geopolitics -- an area in which he has seemingly excelled this year -- to the minutiae of running Russia. That was wise: Putin knows he's received some advances, but he hasn't cashed them in.
If not person of the year, Putin is surely troll of the year. If stories about Russian meddling in the U.S. presidential campaign are true, he has successfully mocked U.S. democracy and rubbed its nose in its imperfections. If they are not true, that's an even better outcome for Putin. In that case he made himself look like a major threat without lifting a finger. Asked about the election at the press conference, he trolled the Democrats as sore losers who blame "external factors" for their failures, throwing back an accusation U.S. Russia-watchers have hurled at him.
Putin's purported role in Donald Trump's victory has also helped him look fearsome to Europe. The German government believes he might try to disrupt next year's election there. Austrian nationalists made a pilgrimage to Moscow to sign a "cooperation agreement" with Putin's party, United Russia. Both front-runners in the French presidential election are Putin fans. And the ego boost Putin has achieved came cheap.
Ukraine is securely locked in a frozen conflict and its political system appears to be imploding as President Petro Poroshenko and his team are revealed as the same kind of venal post-Soviet rulers as their predecessors. At the press conference, Putin trolled Ukraine, saying a bridge he'd ordered built to annexed Crimea would be good for Ukraine after a "normalization of relations" with Moscow. He trolled Europe's attempts to bring Ukraine into the fold, too, saying that he welcomed visa-free travel for Ukrainians to Europe -- scheduled to begin next year -- but that the European Union should allow Ukrainians to work there because that's what they'll come to do.
In Syria, Putin helped President Bashar al-Assad to victory in Aleppo, redrawing the balance of forces and minimizing U.S. influence. As a result, Middle Eastern powers, including U.S. allies, have come to see him as an important player in the region for the first time since the Soviet Union's demise. Saudi Arabia has done a deal with Russia on oil output cuts -- something that would have seemed impossible just three years ago.
And Putin didn't have to pay much for his new clout. Russia has only lost 25 people in Syria and spent between $2.5 million and $4 million a day, a manageable amount compared to Russia's $51 billion defense budget for this year. In fact, despite much that is said about Russian war crimes and brutality, data from the Syrian Observatory for Human Rights show that the Russian intervention has not increased the Syrian war's death toll this year. In the 11 months through November, 46,442 people were killed, as against 55,219 in 2015 and 73,447 in 2014.
So why, at the end of the year, did Putin seem reluctant to celebrate? Even his seemingly boastful statement on Thursday that "today we are stronger than any potential aggressor" was apparently a bit of trolling rather than self-aggrandizement. It provoked U.S. State Department spokesman John Kirby to respond with high praise for the U.S. military, enabling a smirking Putin to stress at the press conference that he was only talking about aggressors.
One reason could be that Putin is yet to reap any tangible rewards from his seeming successes.
Putin, unlike many of his supporters, hasn't acted overjoyed at Trump's victory. It's unclear how the mercurial billionaire will behave toward Russia and how much he'll be constrained by a hostile Republican and Democratic establishment. Trump's potentially Russia-friendly pick for secretary of state, Exxon Mobil Chief Executive Rex Tillerson, faces skeptical vetting by the Senate. Putin's intentions concerning Ukraine-related sanctions are unclear -- he hasn't spoken on the issue since a non-committal response to a reporter's question in July. In 2017, Putin could build an amicable relationship with Trump or have a monumental falling-out.
The EU has just extended sanctions against Russia through July. The buoyancy of Putin's nationalist, euroskeptic allies in the West is still an unrealized threat to the establishment. In Austria, the Freedom Party, whose leaders recently came to Moscow to kowtow, has just suffered a painful electoral defeat, losing a bid for the presidency. Brexit hasn't produced a Putin-friendly government in the U.K. There's a chance that in 2017, nationalist parties will fail in the Netherlands, France and Germany, destroying any post-Trump magic. And French front-runner Francois Fillon may not be as pro-Russian as president as in his opposition years: His immediate goal is likely be to keep the EU together, and unanimity on Russian sanctions has become a litmus test of unity.
Putin has tried to prove that the sanctions are all but dead by selling off a stake in state-owned oil behemoth Rosneft to a consortium of U.S. ally Qatar and Swiss-based commodity trader Glencore, funded by Italian bank Intesa. But the bank appears to be having some last-minute doubts about jumping into this politically fraught deal, and Russia is unlikely to receive the foreign investors' money this year. The deal looked great for Putin, but it could fail in 2017.
Ukraine's desire to get away from Russia's orbit is still as strong as during the 2014 revolution. Though the government is unpopular, it's hard to imagine the next one being pro-Russian. It might even be more staunchly nationalist than Poroshenko's. So far, Putin has managed to destabilize its neighbor but hasn't improved his chances of establishing control.
The Syrian success is also tenuous. Putin's hope, as he told the press conference, is to establish a ceasefire so that Russia, Turkey and Iran could broker a deal among the warring sides. That, however, would be conditional on defeating the Islamic State, a tough job if there ever was one, and on getting all the belligerents to the table -- an achievement that would seal Putin's reputation as a foreign policy wizard, but one that seems as far off today as intergalactic travel. Putin has strengthened his ally Assad's hand in negotiations that may not even take place in the foreseeable future -- or turn out to be as ineffective as previous attempts to pacify Syria.
To top all that, Russia's economic situation is precarious. The 2017 budget is based on $40-per-barrel Russian oil, and if OPEC can't deliver promised production cuts or if U.S. frackers start pumping at the first sign of falling inventories, Russia may face another year of recession and spending cuts. Russians have been patient throughout the last two years' economic woes, but one more year with little good news could even undermine Putin's seemingly unassailable advantage in the 2018 presidential election. Putin has done his best to manage Russia's finances prudently and 2016 has been easy on the country's currency reserves, but that has been a holding action rather than a brilliant anti-crisis strategy.
That may be why Putin wants to talk about micromanaging Russia's problems -- roads, the environment, a spike in the consumption of cheap, life-endangering alcohol -- and not Russia's geopolitical achievements. He is at pains to demonstrate his grasp of the most minute budget and macroeconomic numbers. He's telling Russians that he's thinking of them, not global hegemony. The geopolitics have mostly helped Putin consolidate his domestic support, and if next year the favorable narratives start to fall apart, Putin needs to make sure people's everyday lives show some improvement. That would require at least as much luck as Putin has had this year.
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