June 27, 2024: Vladimir Putin has been running Russia since 1999 via a series of appointments he received, and then elections he won or controlled because he maintained or increased the standard of living for most Russians. That came to an end in 2014 when Russia seized Ukrainian Crimea and parts of two provinces. Western nations responded to this aggression by imposing economic sanctions on Russia. This caused a reduction in living standards for many Russians. The only exceptions were the oligarchs. These were the hundred or so men and women who emerged when the Soviet Union collapsed and were resourceful enough to gain control of many of the former state-owned companies. This made those entrepreneurs fabulously rich and they became known as oligarchs. Anyone seeking to rule Russia needed the support of the oligarchs. At the same time, the oligarchs needed the support of senior government officials to keep their wealth safe and themselves out of legal or political trouble. These efforts ran into trouble back in 2016 when government efforts to control what appears on the Internet inside Russia, and in domestic mass media, were not sufficient to keep out damaging evidence of corruption among the Russian leadership.

This happened with the April 2016 release of 11 million documents stolen via hacking from Mossack Fonseca, a Panama-based international law firm. Data from these documents showed many prominent Russian officials did business with Mossack Fonseca, a firm that assists wealthy people who want to set up overseas bank accounts and corporations whose owners are very difficult for most people, or even other governments to identify. The Mossack Fonseca records provided details of enormous wealth owned by Russian officials who could not explain where it came from. In the state-controlled media these revelations don’t exist and are referred to as more Western lies not worth repeating. Despite that attitude, these details got into Russia via the Internet and eventually reached just about everyone. The damage done was considerable because it made Russians realize that, since 2014, Russia has been making a lot of headlines but not much else. The economy is a mess, it has fewer allies and the future looks dim.

Invading Ukraine and Syria did not help any of these fundamental problems. What passes for good news is things like foreign economists agreeing that the Russian economy is shrinking less than expected. What the government describes as victories in Syria and Ukraine don’t pay the rent or put food on the table. By 2024 more and more Russians are merely getting by and the appeal of the new nationalism is fading. The oligarchs still prosper because they can, at the request of a government official who protects them, move money around to where the government needs it for bribes or illegal investments.

What went wrong? Russia entered the 21st century with a new elected government dominated by former secret police KGB officers like Vladimir Putin who promised to restore economic and civil order. They did so but in the process turned Russia into a police state with less political and economic freedom. A growing number of Russians opposed this and the government responded by appealing to nationalism. Russia has returned to police state ways and its traditional threatening attitude towards neighbors. Rather than being run by corrupt communist bureaucrats, the country is now dominated by corrupt oligarchs, gangsters and self-serving government officials. The semi-free economy was more productive than the centrally controlled communist one but that just provides more money to steal.

A rebellion against the new dictatorship was derailed by astute propaganda depicting Russia as under siege by the West. Yet opinion polls that show wide popular support for this paranoid fantasy left some Russians with democratic impulses who continue demanding better government and needed reforms. But for now most Russians want economic and personal security and are willing to tolerate a police state to get it. That atmosphere, plus the anxiety generated by the Ukraine invasion, scared away a lot of foreign investors and many Russian ones as well. Russia can downplay this in state-controlled media but without all that foreign and Russian capital the economy cannot grow. The only major economic power Russia can still do business with is China, which recognizes Russia’s pervasive corruption and economic weakness and refuses to get too involved.