Putin’s Children: The Russian Elite Prepares For 2024
JANUARY 2020Putin’s Children:The Russian Elite Prepares for 2024A N D R E I KO L ES NI KOV AND DE N IS VOLKOVFor the Russian elites the year 2024, although a longway off, is already the main date in their calendar.The year when President Vladimir Putin finishes hisconstitutionally mandated fourth and last term in officeis supposed to be the moment when Russia gets a newleader for the first time in more than two decades. YetRussian history teaches that such handovers can be acause of unexpected turbulence.Putin and his inner circle are considering several differentoptions as to handling the transition. They includescenarios in which Putin himself formally steps downbut keeps a prominent status by being given a new roleas “father of the nation,” rather as has happened withformer president Nursultan Nazarbayev in neighboringKazakhstan. (Some new evidence of this came duringthe latest government reshuffle in January 2020, whenPutin announced a constitutional overhaul including,among other things, new powers for the State Council,which may become the new avenue by which he leadsRussia.)Those decisions will happen a bit later. But alreadya collective effort is underway to make the year oftransition as painless as possible and ensure publicsupport for a change in leadership.To ensure a smooth transition in 2024, a key role in thisprocess has been allocated to a group of people that hasa low profile in society yet holds important managerialpositions in the state apparatus. This group can becalled the “technocratic elite,” a diverse collection ofRussian officials who hold certain things in common:they are educated professionals, profess their loyaltyto Putin, but, unlike the siloviki (senior officials in thesecurity services and army), do not make key politicaldecisions and are not deemed eligible for high politicaloffice. This “technocratization” of elites gave expressionin the appointment of a pure technocrat in his fifties,the former head of the taxation ministry MikhailMishustin, to the position of prime minister. Manyof these technocrats are the products of professionaltraining schemes supported by the top Kremlin officialsAnton Vaino and Sergei Kiriyenko.C A R N E G I E E N D O W M E N T F O R I N T E R N AT I O N A L P E A C E
In the fall of 2018 and the spring and summer of2019, the Levada Center, Russia’s leading independentpolling organization, and the Carnegie Moscow Centerconducted two series of in-depth expert interviews withsenior figures in or close to the Russian political elite.The respondents, all of whom remain anonymous, arewell acquainted with the technocratic elite and are inone way or another involved in the country’s transitionin the year 2024.1 They paint a picture of a widerRussian elite already bracing itself for upheaval.Much is at stake for the country’s ruling class. As politicalanalyst and writer Ivan Krastev has observed, thisprocess is about perpetuating “Putinism” in the absenceof Putin himself. Krastev writes, “Putin’s conviction[is] that Russia needs not a single successor—as it didunder Boris Yeltsin—but a successor generation. Hesees the coming transition as a transfer of power fromhis generation to the ‘Putin generation,’ comprisingpoliticians who came of age during, and have beenshaped by, Putin’s rule.”2 The Kremlin is trying toengineer a collective succession mechanism.In purely practical terms, the 2024 election will be onein which the generation of “Putin’s children,” those whohave made their careers and profited from the twentyyears of Putin’s presidency, face a serious challenge tokeep the assets they have acquired. Many are literallythe children of the current elite and have now takentop jobs in government and business. For example, inthe spring of 2018, Dmitry Patrushev, a son of Putin’sclose associate and former FSB chief Nikolai Patrushev,became the minister of agriculture. Other sons ofPutin’s cronies to have been appointed to high positionsinclude Boris Kovalchuk, son of Yuri Kovalchuk, thelargest shareholder of Bank Rossiya and a close Putinassociate; Gleb Frank, son of former transport ministerSergei Frank and son-in-law of Timchenko, a billionaireand friend of Putin; Igor and Roman Rotenberg, sonsof the billionaire Arkady Rotenberg, Putin’s formerjudo partner; and Sergei S. Ivanov, son of old Putinally Sergei B. Ivanov. The problem the elites face, as2one interviewee put it, is that “it’s impossible to inheritproperty fused with the state.” In other words, if thefathers are removed from power, then the sons willinstantly cease to be successful business leaders.TH E TRA N SITIONThe hope in the Kremlin is that when Putin’s fourthpresidential term ends, everything will stay basically thesame, despite the impression of a changeover.Putin was first elected president of Russia in 2000, whenhe was forty-seven. He served two constitutionallymandated four-year presidential terms before handingover the reins to his younger protégé, Dmitry Medvedev.Medvedev served one term as president while Putinworked as prime minister. Then the two changed rolesin what Russian experts called a castling maneuver, asin chess. With new constitutional amendments in placeextending the presidential term to six years rather thanfour, Putin returned to the presidency in 2012 and wasreelected in 2018.All of this promises to make 2024 a rather special yearfor the simple reason that, under the constitution asit stands, Putin will no longer will be the president.To maintain power, Putin and his inner circle havechosen the “Kazakh option,” modeled on the decisionmade by the veteran leader of Kazakhstan, NursultanNazarbayev, who stepped down in March 2019 andhandpicked a successor.Levada Center surveys suggest that most Russians wouldnot object to Putin staying on. A poll conducted in June2018 found that 51 percent of Russians said they wouldlike to see Putin remain as president once his currentterm expires, in spite of the constitutional limit. That isa drop from a high point a year before when 67 percentheld that view, but it is much higher than in 2012 whenmore respondents opposed this proposal than supportedthe idea of him remaining president.3
If it comes to naming actual candidates for thesuccession, focus group participants most oftenmention former prime minister and former presidentDmitry Medvedev.4 They also name Defense MinisterSergei Shoigu and, somewhat less frequently, ForeignAffairs Minister Sergei Lavrov, Moscow Mayor SergeiSobyanin, and Pavel Grudinin, the Communist Partycandidate in the 2018 election.61 percent of respondents said that Putin is “fully”responsible for the country’s problems, while 22 percentsaid he bears “some” responsibility.5 Putin’s ratingsdropped in 2018 thanks to declining living standardsand the announcement of pension reform. The overalleffect is that discontent with the situation in the countryand with the president’s performance is still a minorityposition, but it is no longer a marginal one.Many however cite recent historical experience inRussia and suggest that Putin’s most likely successor willbe someone who is currently not so prominent in thepublic eye. That was the case with Putin himself, whowas a virtual unknown in 1999, and with Medvedev,who was little known before he ran for president in 2008.Under this scenario the official candidate will be a lesserknown person who the public hasn’t “gotten tired of ”and who appears a year before the election. Focus groupparticipants said that this would be a “decent,” “worthy”person. He might be someone from the security servicesor the military and may have administrative experienceas a governor or regional leader.The governing regime has already received a warningsignal in the gradual fall in popularity of the UnitedRussia party, founded in 2001 to support the president.United Russia doubled its approval ratings after theannexation of Crimea—from 25 percent to 50 percentof the total population. The party did badly in 2018regional elections as a result of “protest voting” forany party except United Russia. (In the 2019 regionalelections, despite the fact that it was often assessedas “toxic,” its candidates were more successful.) TheNovember 2019 United Russia party conferenceinitiated a relaunch of the party: all the pro-Kremlincandidates for significant top positions in both thecenter and the regions must now be supported by this“party of power.”The Kazakh model carries certain risks for Putin. Even ifhe retains an official role, the public may come to regardthe new president as a more powerful figure than theprevious one. Putin has personal experience of this. By2012, when his close ally Medvedev was nearing the endof his four-year presidency, Medvedev’s ratings had almostreached the same level as those of prime minister Putin.The institution of the president of Russia, regardless ofwho filled this position, proved to be as important as thepersonality and history of Putin himself. This necessitatedPutin’s return to the presidency in 2012.Putin and his team face another, potentially less solvableproblem in 2024: his poll numbers are good but no longerstellar. Ever since Putin returned to the presidency forthe second consecutive time in 2018, the polls startedshowing that the public holds him responsible not onlyfor all the good things in the country, as was the casebefore, but also for all the bad things. In October 2018,The upside for the Kremlin is that Putin has thus farbeen protected against a dramatic fall in his ratings,thanks to the government’s control of the main televisionchannels and the absence of political competition inRussia. The decline in the president’s popularity has sofar not benefited any other politician.TH E TECH N OCRATSPutin’s governing regime does not operate in a vacuum.Though authoritarian in practice, it has always soughtpublic legitimacy and must take public sentimentsinto account. In the last year this legitimacy has beenstrained because of stagnant real income and discontentover pension reforms.C A R N E G I E E N D O W M E N T F O R I N T E R N AT I O N A L P E A C E3
Levada polls suggest that the Russian public currentlyhas a strong if rather poorly articulated desire forchange.6 This has not escaped the notice of the Kremlin,say the interviewees. They say that the emergingstrategy for a smooth 2024 transition is to impress thepublic by imitating change. That means implementingtechnocratic improvements without an accompanyingpolitical transformation.This strategy—and the management of much of theeconomy more broadly—falls on the shoulders of agroup that can be called the “technocratic elite.” Thetechnocrats must ensure that the economy is doing aswell as is possible, or to be more precise, is seen by thepublic to be performing decently.The concept of a new technocratic elite is the brainchildof two backroom Kremlin strategists, the president’schief of staff Anton Vaino and his first deputy (andformer prime minister in 1998) Sergei Kiriyenko. Asone interviewee put it, if it’s impossible to change theinstitutions, one can at least try to improve the qualityof bureaucracy by changing their faces.Often the technocrats are the agents of the executive inthe regions. They answer to the federal authorities andhave to act in spite of the interests of the regional elites.The Kremlin entrusted them with the implementationof twelve so-called national projects, state programsfor social and infrastructural development introducedby Vladimir Putin on his inauguration in May 2018.7These, in form if not in substance, echo the ambitiousfive-year plans of the Soviet era. Among them are suchprograms on demography, healthcare, ecology, saferoads, and digital economy.The digital economy program was instituted bypresidential decree in March 2019 and promised 1.8trillion rubles ( 26.2 billion) of investment by thegovernment over five years. Digital economy as suchis considered by the authorities the main driver of thepossible development of the country and a substitute for4economic modernization and structural and politicalreforms. This program is the preserve of the Ministryof Digital Development, Communications, and MassMedia of the Russian Federation, a government agencythat was relaunched in 2018 to include “digital” in itstitle.Yet respondents indicate that the project is misconceived.They say that the ministry is managed through “a dirigisteauthoritarian model” and are scathing about its level ofcompetence. Initially, successfully developing the ITindustry in Russia was reserved for the private sector.Later, the state took control, forcing IT companies towork within the confines of the government-controlledeconomy.Generally, the main idea (and at the same time,consequence) behind the national projects is theincrease in state interventionism. The state, not themarket, is choosing priorities. But a low rate of budgetimplementation of the programs proves a seriousproblem for the national projects. In November 2019,only 20 percent of the annual budget of the digitaleconomy project had been allocated. The Kremlinnoted that many programs were slow to start planning,among other problems.To find new, comparably young, and uncorrupttechnocrats, Vaino and Kiriyenko have drawn onprofessional training schemes that are now turningout dozens of younger Russian officials. One of thebest known programs, called Leaders of Russia, isdescribed as an “open competition for the leaders of anew generation.”8 Other programs include the RussianPresidential Academy of National Economy and PublicAdministration,9 the Moscow School of Managementat Skolkovo,10 and the Agency for Strategic Initiatives.11The key performance indicators (KPIs) were developedto evaluate the efficiency of the new public servants.12The training programs attracts high-quality graduatesin economics and the social sciences. They adopt
teambuilding exercises from the West, which are muchmocked, that put participants through endurance tests,such as leaping from cliffs or climbing under armoredvehicles.13The stereotype of those who attend these programs isa younger person in their thirties or forties (or morerarely, their fifties), full of energy, wearing a goodsuit and spectacles—a bit like former prime ministerSergei Kiriyenko in his younger days. While some ofthe graduates fit this stereotype, others do not. Ourrespondents identified a wider range of personalities:aggressive leaders who seek conflict with the establishedlocal elites; “optimizers,” meaning technocrats suchas forty-year-old, former Perm governor and newlyappointed Minister of Economic Development MaximReshetnikov seek to deliver better economic and socialindicators including informal and formal ones like theKPIs; and resource allocators, whose business relieson connections with the state, such as former fishingexecutive and current governor of far eastern Primoryeregion Oleg Kozhemyako.Some of these new officials are trying to destroy thesystem of regional clan networks through a tactic of“brute force modernization,” which seeks to replaceevery current official around them. Others simply carryout orders from above. In some regions, governors aremerely front men for state-owned corporations thatrun the regions—as is the case for instance with AlexeiDyumin of Tula region, where industrial conglomerateRostec is really in charge.How important are these professional trainingprograms? Putin is said to have nothing against them,and he even meets the graduates of different executivecompetitions from time to time.14 But this is still nothis favored method of selecting officials. Respondentsbelieve that the Leaders of Russia competition is the petproject of Sergei Kiriyenko and presumably would notsurvive without him.The official backers of these schemes hope that thenew technocrats they appoint at the mid-level of thegovernment pyramid will start rising up to the topand gradually impact higher-level government policyin a more rational and liberal way. Of course, thiscan only work up to a certain point before politicallimitations come into play. A winner of a Leaders ofRussia competition simply can’t hold a top job likedefense minister or be a candidate for governor of St.Petersburg. This is the sphere of the exclusive influenceof the security services officials, the siloviki.The influence of the technocrats is limited by thecontinuing power of the siloviki political community.New appointments to government positions must stillbe cleared with the siloviki. This logic explains Putin’schoice of a loyal colorless bureaucrat Alexander Beglovas his candidate for St. Petersburg governor.The technocrats in government are primarilyaccountable to the Kremlin rather than the public theyare supposed to serve. Their main obsession is not toserve the people, but to make a good report, sometimeswith imitative results and corrected figures. “Reportingtakes precedence over development,” as one of ourinterviewees put it.Many high-ranking political and oligarchic positionsin Russia are still filled by men with a past in thesecurity services who are personally close to Putin.He has appointed officers from his security detail toseveral high-ranking positions. These security and lawenforcement officials remain the people the presidentinstinctively trusts.THE LIMITATIONS OF TECHNOCRACYThe Russian elite is gearing up for the year 2024 as ayear of transition. They know that they will have to livewith a decision that will be made by a very narrow circleC A R N E G I E E N D O W M E N T F O R I N T E R N AT I O N A L P E A C E5
of people around Vladimir Putin. It is less importantfor them exactly what this decision is than to fashion asurvival strategy.Abyzov. His resignation from the government in 2018ended the scheme. A year later he was arrested on fraudcharges, further tainting the image of the project.This waiting game is already having a deleteriouseffect on the way that Russia is managed. Contrary tothe belief of many outsiders, the country is not beingmicromanaged by the Kremlin and most edicts from thetop have a didactic purpose, recommending how officialsshould behave. Bureaucrats and managers are givena great deal of latitude. An average member of today’selite can be described as a kind of “little Putin.”15 Thatperson’s administrative decisions and political behaviorare guided by the question “What would Putin do in myplace?”—a question that can be interpreted in differentways. So countless “little Putins” try to guess how the“big Putin” in the Kremlin would behave in their placeand add their own personal agendas into the equation.The reality is that, for all its rhetorical support forprofessional technocrats, the ruling regime defaults torelying on bureaucrats who are more loyal than theyare competent, many of whom come from the securityservices. “The system discards active and experiencedforty- and fifty-year-olds, forcing them to emigrate orgo fishing,” as one of the experts put it.It is true that the technocrats now have a more solidorganizational base, thanks to training programs thatenjoy serious support from the Kremlin. But none ofthe interview respondents believe that the technocrats’projects are deeply embedded. Instead, they believe thatthe programs could easily be reversed or abolished. Theynote that in the current political system, the departureof one individual responsible for a particular projectprobably spells the end of this project. One exampleis the Open Government Project, a transparencyinitiative, which was the brainchild of minister Mikhail6Russia’s technocrats and entrepreneurs have no say inthe coming political transition in the country. Civilsociety actors, drawing attention to local issues ofconcern to the public, are likely to be more influential,if only insignificantly so.16A key question then remains: if the ruling regimedecides that Russia’s problems can only be fixed by agenuine modernization program, how will the elites bereconfigured? Russian elites would ea
Putin’s Children: The Russian Elite Prepares for 2024 ANDREI KOLESNIKOV AND DENIS VOLKOV For the Russian elites the year 2024, although a long way off, is already the main date in their calendar. The year when President Vladimir Putin finishe
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