Will Law Gain Increased Relevance in

Contemporary Russian Politics?

Kennan InstitutionMay 2009

Ethan S. BurgerAdjunct Professor

Georgetown University Law CenterSenior Counsel – Maxwell & Barke LLC

esb34@law.georgetown.edu

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Why Care About the Legal Framework?

• Does Russian written law matter – or does it merely offer a veneer of legality?

• Was Putin restrained by Article 81(3) which limits individuals holding the office of President of the Russian Federation for more than two terms in succession? Of course, many loopholes existed.

• Alternative view: Felshtinsky’s and Pribylovsky’s “The Corporation” and Novaya Gazeta’s Leonid Nikitinsky’s rule of the “ments.”

• Recall that the origin of law was primarily to protect property from the government.

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Today’s Economic Context

• During Putin’s presidency, Russian poverty declined and the economy grew (7%). High commodities prices were key; overall little diversification.

• MTS dropped approximately 75-80% in Spring 2008; large amounts of flight capital from Russia – BEFORE the Global Financial Crisis & Russian Invasion of Georgia.

• Initially, Putin bailed out the Oligarchs as the primary goal of “stabilization” efforts. Now, the State has essentially gained natural resources given up during Yeltsin loans-for-shares program.

• Russia now projects its first governmental deficit in a long time (8%) and economic shrinkage of -2.2% (should be higher). It has tapped the country’s stability fund to the tune of $80 Billion. Western banks lending to Russia has almost halted.

• Russian banks buy dollars, driving down value of ruble; inflation at 12%; ruble lending almost stops. Printing more money will trigger greater inflation. PROBLEM: No safety net. Wage arrears reappear. Unemployment up. No improvements in education, environmental protection, health, housing, infrastructure in near-term.

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Medvedev’s Anti-Corruption Campaign• Medvedev made combating corruption a central

objective of his November 2008 Annual Address to the Federal Assembly.

• Federal Law 273-FZ “On Countering Corruption,” passed by State Duma in December 2008 – definitions and formal program.

• Old Requirements & Innovations: (i) state officials must declare income & net wealth, (ii) inform on others, (iii) conflict of interests, and (iv) tenders for state purchases.

• What is happening to the Anti-Corruption Campaign?

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What Explains Medvedev’s Outreach Program?

• Last month, Medvedev picks NG known for its criticism of Putin -- to get first full newspaper interview.

• Putin had never spoken to an opposition media outlet and spurned  journalists.

• Medvedev establishes own blog and agrees to be a guest on a regular news program, answering questions asked by a popular television anchor.

• Symbolic or substantive? Manipulation of domestic and foreign opinion or testing of the waters for a contemporary version of glasnost’. Who is the target audience?

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Is Medvedev Using Law as a Way to Gain Power?

• Are there segments of Russian society who believe that Medvedev is the best realistic option at this point?  Are the interest groups that might seek to stop him like those who attempted to seize power from Soviet President Gorbachev in August 1991?

• Russian and foreign law may come into play with respect to financial and other assets abroad in countries that are reforming their banking and corporate secrecy laws.

• The Russian urban population have a much greater understanding of the outside world; but can Medvedev the Intelligent appeal to Ivan Ivanovich Ivanov? Don’t forget the demonstrations in Vladivostok. 

• Ironically, organized crime groups that lack ties with governing elites see the benefits of a more economically opened society. Will Russian enterprise heads who lack the “right” political ties see an ally in Medvedev?

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A Plausible Scenario? (1 of 2)

• If Medvedev seeks real control over the government, he must:

1) limit the impact of country's and the world's current financial crisis;

2) implement his anti-corruption efforts in a meaningful way -- let there be (some) justice in the land;

3) become president both de facto and de jure (fire those who have been responsible for failed policies);

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A Plausible Scenario? (2 of 2)

4) address the issues Mr. Putin promised to attack that affect the bulk of the country's population: education, environmental protection, health, and housing while diversifying the economy;

5) end the near-pariah status of Russia abroad (Europe has changed after Georgia and the cutting off of its energy)

6) what Russia's neighbors think Abkhazia and South Ossetia's future portends; and

7) strengthening small and medium businesses (only made possible through the establishment of a genuine rule of law with accountable officials).

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Presidential Immunity Under Russian Law

• Russian Constitution Article 91 merely states that the president “possesses immunity.” Exact scope unclear.

• In 2001, then-Acting President Putin’s Edict No. 1763 granted former President Yeltsin and his family. The “Family” was renowned for its lavish lifestyles and corruption. It gains immunity from criminal prosecution, administrative sanction, arrest, detention and interrogation for life.

• On July 24, 2007, the Federal Law 12-FZ “On Guarantees to the President of the Russian President having Ceased using his Powers and to Members of His Family” was amended so that the process by which a former president could be stripped of his immunity could only be initiated by the Investigative Committee’s Chairman.

• Will Medvedev make Putin an offer he cannot refuse? Will Putin accept? What are the implications for the “ments”?