Will Russia use its veto in the Security Council? ‘We shall use our veto according to our national interest.’ In the middle of a lavish dinner the Russian bear had growled. And what about relations with Germany? Just one year before, everything seemed to be in the hands of Gerhard and Vladimir, but by now Chancellor Schröder and the Social Democrats had been replaced in government by Angela Merkel from the Christian Democrats – and things looked different indeed. Ms Merkel, he remarked philosophically, would have her own priorities in shaping the EU agenda while President of the European Council. As far as Russia was concerned, energy of course would continue to dominate the agenda. Russia wanted to have its full share of political and economic competition throughout Europe. Some partners – meaning France – disagreed. ‘But Russia is no longer the Empire of Evil’ – he joked, referring to Ronald Reagan’s famous remark about the Soviet Union. The future North European gas pipeline would not, he insisted, defending the Schröder-Putin project, take anything away from others.
The pipelines via Ukraine and Poland would continue to be needed. The criticism of the additional pipeline, he hinted at Warsaw and the Baltic states, could only be ‘politically motivated’. In a nod to Berlin, he added: ‘Serious people do understand.’ Moreover, after Kiev had severed the bond with Russia fifteen years ago, the Russians had subsidized Ukraine to no small extent, selling oil and gas well below world market prices. For years on end the Russians, not least under pressure from the World Trade Organisation to go for market prices, had tried to arrive at a negotiated settlement. Then the orange revolution occurred. ‘This has a price,’ Putin added with a wry smile. ‘In spite of so much frustration we have stabilized the situation. In the old days we concluded agreements with Ukraine year after year, and they included transit fees. The West Europeans had no idea that their energy security was a cliffhanger. By now we have a five-year agreement for transit to the EU. This is an important step in the direction of European energy security.’
Again and again the Russian President comes back to energy. Everything develops, he says, as a function of energy and its price. What does this mean for the economic development of Russia, the state budget, rate of inflation, welfare, and demography? Putin seems to love facts and figures, and he gives his listeners an impressive lecture on Russia’s present and future macroeconomics. Above all, he insists, the state budget should not grow faster than the real economy to prevent inflation. ‘The Russian economy needs diversification, especially in the direction of high technology.’ Putin, as a former KGB officer, must have been aware of the Soviet system’s fatal weakness in information technology. This was systemic, no doubt. But it had been recognized as a mistake not to be repeated. Infrastructure in general, roads in particular, needed massive investment. The main burden of taxation would in the future fall on energy, and this would inevitably make for higher prices in domestic consumption. The present rate of inflation, he stated, was at an unacceptable 9 per cent. In a few years’ time both the government and the Central Bank intended to bring it down to 4 or 5 per cent. ‘This, however, will limit our chances to use our oil income for improving general welfare. The most serious aspect is demography.’ The Russian population – he did not say ‘the population of Russia – was greying and shrinking. The growing economy needed a growing workforce. Additional labour could come from the Central Asian republics, working in construction. ‘While there are serious labour shortages almost everywhere, I am more concerned about the decline of population throughout Russia. I have made this the leitmotif of this year’s annual state of the nation message in the Duma. Special leave for young mothers, a bonus for parents who want to have more than one child, or who adopt children. After maternity leave mothers should be able to return to their jobs without being disadvantaged. We need many more crèches and kindergartens. General political support is wanting. The family is the core of society.’
And in this context, what is the role of religion? All over the world, a religious renaissance can be observed. In the Zagorsk monastery, the day before, newly-weds and young recruits in uniform had made the pilgrimage to the holy fountain, washed their faces and drank of the water. Is that the future? When he answered, it was the only time that Putin made a personal reference. ‘Russia,’ he said, ‘has always been a very religious country. Since the seventeenth century my father’s family has lived in a village not far from Moscow. Only recently the church registers yielded the information that my forebears had always attended church and visited the confessional.’
Is there future in the past? ‘The Orthodox Church has always been a moral institution and an element of political order. Since 1917 the ideological context changed. But there was no other moral institution to fill the ensuing vacuum. The Orthodox Church has suffered great pain, much as Jews and Muslims. Those wounds have never been accounted for. The separation between the state and the church will continue. Religious freedom is fundamental.’
After three hours it was time to ask about his vision for the future and his legacy. Above all, Putin said, it would be necessary ‘to strengthen the state in Russia, to reinforce moral standards and to encourage efficient institutions. Russia’s industry needs to be modernized, indeed reinvented and modernized – Russia’s currency reserves have risen from a meagre $19 billion to $270 billion. Hyperinflation has been stopped. We have full employment. At present the economy registers growth at 7.4 per cent p.a. Meanwhile, four out of ten Russians still live below the poverty line. A great deal needs to be done.’
What measures does he see as a priority? ‘To fight the ubiquitous corruption, to stabilize a multiparty system. Power has to be better divided between the centre, the regions and the municipalities’ – so says the man who is in love with ‘the vertical of power’. A multiparty system? He is concerned that the vested interests of different classes and groups in society are too strong. A multiparty system would channel those divergent forces into a more manageable system.
Putin’s philosophy combines his Russian experience and his German vision, the essence of both Dostoevsky, the Russian writer, and Hegel, the Prussian philosopher. The strong state is needed in order to protect society from the demons of anarchy. ‘In Russia, the political system is underdeveloped.’ So much so that it could become necessary for him to continue in office beyond his second term? ‘The great majority wants stable government. But it is not for one man alone to create good governance.’ The constitution, he adds without a discernible moment of regret, is very clear on this point. And if there is a temptation to bend the letter of the constitution, he does not want his interlocutors to sense it: ‘There is no exception for me, because this would be destabilizing. We cannot make the destiny of an entire country dependent on the fate of one man – even if this man is me.’
That was in September 2006 near Moscow. A year on, in Sochi, the time to say goodbye had drawn nearer. But Putin in his remarks sounded as if he would be around for a long time to come: We will do this, we will do that… Who is ‘we’? The party United Russia that he had called into being? The intelligence services running the administration? The President of today? Or the President of tomorrow? Or would Putin part with the presidency and come back in another incarnation? Speculation was rife in those mid-September days of 2007, less than a week after Putin had unexpectedly fired the government of Prime Minister Fradkov. In his stead he had appointed an unknown tax official, Mr Subkov, whom he knew from St Petersburg days. Subkov had made a reputation as head of the financial police. He was so little known outside the political class that, when his name was aired in Moscow and the rest of the world, it was difficult even to find a photo of him, let alone a CV. Putin, once again, had surprised almost everybody and opened a new round of guessing what this manoeuvre implied for the presidency – and the future of Russia.