Russia's longterm decline

Phillip Stephens:

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Many in the west seem to think there is nothing to be done. Authoritarianism is back in fashion and Russia’s return as a great power is one of the ineluctable geopolitical trends of the 21st century. The west must adjust to the reality, ceding the ground that Mr Putin seeks.

This analysis misses one of the paradoxes of Russia’s power. The riches and political leverage provided by gas and oil have restored Russia’s economic and geopolitical standing. Yet, for the medium and long term, almost all the other indicators point to a future of relative decline.

Low fertility and high mortality rates hold the prospect of a fast-shrinking population in a country where vast tracts of territory are already empty. Demographers estimate that the present Russian population of about 140m will fall by about 10m within a decade or so. By 2020 Moscow will struggle to find sufficient recruits to maintain its conscript army.

Demographic decline is mirrored by crumbling health and education systems and by decaying civil infrastructure. Corruption is rife. The present political leadership is better described as a kleptocracy than an autocracy. Vast amounts of Russia’s wealth are being siphoned off in bank accounts abroad rather than reinvested at home.

The price of Mr Putin’s aggressive nationalism has been to starve the oil and gas industry of foreign technology and investment. In spite of the emergence of a Russian middle class, there are few signs that the petro windfall is being used to broaden and deepen Russian prosperity.

The second paradox concerns Mr Putin’s deep sense of grievance against the west. For all the talk that the US and Europe conspired in Russia’s humiliation after the collapse of the Soviet Union, the strategic threats facing Moscow lie elsewhere: in unresolved border disputes with a resurgent China in the depopulated far east and in Russia’s own separatist movements in the south.

They may share an authoritarian political instinct, but all logic says that Moscow and Beijing are more naturally strategic rivals than partners. Mr Putin’s support for separatism in South Ossetia and Abkhazia, meanwhile, sends a curious message to those in Chechnya and elsewhere on Russia’s southern border who want to be free of Moscow’s rule.

None of this, many will say, is of much help in resolving the crisis. If Europe’s impotence has been long apparent, the invasion of Georgia has also humiliated the US. Washington’s protestations have been brushed aside by Mr Putin almost as flea bites.

It will not always be so. Longer term, the west’s strategic response should be guided by a clear-sighted appreciation of Russia’s weaknesses as well as its strengths. There will come a time when Moscow itself badly needs the shelter of the international order Mr Putin now so visibly disdains. The US and Europe should not seek confrontation with Russia; but nor should they retreat when Mr Putin brandishes his gun.

I think China is a more dynamic culture at this time and their demographic problems are the opposite of the Russian. They are the ones who will be more interested in finding space for an expanding population and industry.

Russia has become the frozen equivalent of Saudi Arabia with little industry of value to the rest of the world. Besides weapons of dubious quality, what does Russia export--oil and gas. It is exploiting a depleting resource and has runoff those who could make that resource more productive.

China, on the other hand, has been exploiting its human capital to produce goods and services that people around the world want and need. China's products can be found in Wal-Mart and Harbor Freight at reasonable prices and value.

If the two ever are in conflict in the coming years, I think China should be the favorite in that fight.