Noel Foster
The most effective general in Vladimir Putin’s Russia is a diminutive economist by the name of Elvira Sakhipzadovna Nabiullina. When Russia’s frontlines were collapsing in summer 2023—and Chief of Staff General Valery Gerasimov and Defense Minister Sergey Shoigu were shamed by Yevgeny Prigozhin, who then proceeded to mutiny and march on Moscow—Nabiullina calmly kept the ruble afloat and counteracted Western sanctions. A product of a workingclass ethnic Tatar family who pushed the limits of late Soviet meritocracy, Nabiullina has preserved the ruble since being named Central Bank governor in 2013, in the face of successive rounds of Western sanctions and war following Putin’s February 2014 takeover of Crimea. One would do well to listen to Nabiullina’s warnings, therefore, when she told the Duma that the main threat to the Russian economy comes not from the West’s sanctions, but rather from Russia’s labor shortages.1 In an overheated war economy, 85 percent of Russian companies reported worker shortages, and salaries for semi-skilled positions increased by up to 20 percent.2 That is untenable.
For this very reason, Putin has done the unthinkable, replacing Defense Minister Sergei Shoigu, a former military officer, with an economist, Andrey Belousov, on May12,2024. Since 2012, Shoigu had served Putin loyally, if not well. As Russia’s military entered a third year of a costly stalemate, his position had nonetheless seemed secure, but as Kremlin press secretary Dmitri Peskov explained, “we are gradually approaching the situation of the mid-80s when the share of expenses for the security bloc in the economy was 7.4%. It’s not critical, but it’s extremely important.”3 The Kremlin is engaged in an industrial-age war with Ukraine. Much like the World Wars, this is a war of production, pitting Russia’s globalized wartime economy against that of Ukraine and its allies in a war of attrition. For Putin, war is too important to be left solely to the generals, and so Russia’s technocrats and economists are increasingly taking over.
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