Russia Is Doomed

Don’t be fooled by Putin’s façade; the pillars of Russian power are steadily declining.

By Zachary Keck

March 05, 2014

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Everywhere one looks today, signs of a resurgent Russia are omnipresent. Although Vladimir Putin has undoubtedly worked hard to craft this image, it is a mirage. Russia is doomed over the long-term, and its short-term maneuvers aren’t enough to compensate for this fact.

Traditionally, Russian power has rested on four pillars: population, energy, weaponry and geography. Three of these are diminishing.

The backbone of modern Russian power has been its massive population. Nowhere was this better demonstrated than in WWII. Russia no doubt played a leading role in orchestrating Hitler’s demise, starting with its legendary stands in Leningrad and Stalingrad. However, Stalin sapped the military might of Nazi Germany less because of the strategic or tactical genius he possessed, and almost entirely through his willingness to expend the lives of his citizenry.

According to some estimates, the Soviet Union lost somewhere between 22 and 28 million people during WWII. To put this in perspective, the United States and Great Britain each lost less than half a million people and even Germany only lost between 7 and 9 million lives during the war. Nonetheless, for nearly half a century after the war the Soviet Union could credibly threaten the much richer West solely because of the sheer number of men it could put under arms.

Yet like most of Europe, Russia has recently seen its population dwindle even as countries like China, India and much of the third world have seen sharp rises in their own populations. As AEI’s Nicholas Eberstadt observed inWorld Affairs: “in the last sixteen years of the Communist era, births exceeded deaths in Russia by 11.4 million; in the first sixteen years of the post-Soviet era, deaths exceeded births by 12.4 million.” Unless Russia can reverse this depopulation for a sustained period of time, it will likely become increasingly irrelevant in international politics.

Another source of modern Russian power has been its massive energy reserves. Indeed, high oil prices during the 1970s allowed the Soviet Union to flex its muscles abroad. However, as energy prices stabilized during the 1980s the artifice upon which the Soviet system began to crumble. Far from continuing to expand, the end of the decade saw the Soviet empire disintegrate, with Moscow powerless to stop it.

The so-called resurgence Russia has enjoyed since Putin first assumed power has also been built on high energy prices. And like the Soviet leaders before him, Putin has squandered the temporary respite provided by high energy prices instead of using it to reinvest in the country and its people. As the European Bank of Reconstruction and Development noted gloomily in December 2012, “Not only are Russian exports highly concentrated in natural resources, this concentration has increased over time: the shares of oil, gas and other minerals in Russia’s exports are higher today than they were 15 years ago.”

It went on to reflect: “In 2012 Russia remains highly dependent on its natural resources. Oil and gas now account for nearly 70 percent of total goods exports…. Oil and gas revenues also contribute around half of the federal budget. The non-oil fiscal deficit has averaged more than 11 per cent of GDP since 2009, while the oil price consistent with a balanced budget is now in the region of US$115 per barrel and rising.”

The problem with the Russian Federation’s economic model, much like that of the Soviet Union’s before it, is that it is only sustainable so long as energy prices remain artificially high. But, of course, energy prices are almost certainly going to decline over the coming years as a result of greater energy efficiency in the West, slowing growth in the East, and greater supply as a result of the energy revolutions being enjoyed in the Western Hemisphere and elsewhere around the world. And as goes the price of oil so goes the Russian state.

Also like the Soviet Union, Putin’s Russia has managed to maintain a modicum of global influence through the sale of its military weaponry. Although Russian military technology is greatly inferior to the West and the United States, it is sufficient to meet the national security needs of most states around the world. More importantly, Moscow continues to exhibit a willingness to provide it to states that the West refuses to deal with on moral or geostrategic grounds. In these states at least, Russia has been able to maintain a degree of influence.

This source of influence will also diminish in the years ahead. In some places, this will be because of declining defense budgets. In most cases, however, it will merely be because of greater competition from the likes of Chinaand South Korea, the former at least also willing to overlook the moral transgressions of potential buyers.

Thus, over the long-term Russian power will have to come nearly exclusively from its prized geography. To be fair, the value of this real estate is increasing thanks to the increased importance of Asia and the warming of the Arctic. Still, this alone is hardly sufficient to sustain Russia as the major power it once was, and may someday become again.