Eugene Chausovsky [00:00:00] Hello, I'm Eugene Chausovsky, Senior Eurasia Analyst at Stratfor, and this podcast is brought to you by Stratfor Worldview, the world's leading geopolitical intelligence platform. Individual, Team, and Enterprise memberships are available at worldview.stratfor.com/subscribe.

Lauren Goodrich [00:00:26] There's a major banking crisis, hundreds of banks have been closed down in recent years. A good number of the big state firms have been asking for bailouts. Regional governments are tottering towards bankruptcy. All of this has really threatened the Kremlin's ability to maintain economic stability.

Joshua Cook [00:00:44] Welcome to the Stratfor Podcast, focused on geopolitics and world affairs from stratfor.com. I'm Joshua Cook sitting in for host Ben Sheen. While the rest of the world is still talking about the 2016 U.S. presidential election and claims of Russian involvement, more than a year later, Russia is preparing for its own presidential election season coming up in 2018. In this episode of the podcast, Stratfor Vice President of Global Analysis Reva Goujon sits down with Senior Eurasia Analyst Lauren Goodrich to discuss Russia's upcoming elections, how things are changing there, and what all this means for President Vladimir Putin's grip on power. Thanks for joining us.

Reva Goujon [00:01:36] I'm Reva Goujon, and I'm sitting here with Lauren Goodrich, our Senior Eurasia Analyst, to discuss election season in Russia, with 2018 being potentially a pivotal year in some ways, and in some ways not so much. Lauren, we are entering Putin's 18th year in power. This makes him the longest serving leader in Russia since Stalin. Setting all kinds of records here, right? So as we prepare for Putin's announcement for his candidacy going into election season, with presidential elections due in March, regional elections due in September, set the scene for us. What are Russians thinking about, going into this election season? Where are the pressure points?

Lauren Goodrich [00:02:22] Well for the majority of his almost 18 years, Putin has ridden on a wave of popularity, and personal devotion, from a good majority of the Russian people towards him, because he has been seen as the figure who saved Russia after the crisises within the 1990s. That kind of epithet has really held Putin into power, and his hold on power, for the majority of his time as either president or prime minister. There's a lot of cracks in the system that have started to really surface as the years have gone on, especially since 2011, 2012, and the Kremlin itself is facing some very serious challenges that by themselves may not destabilize the current regime, but when you put them together, there are problems that the Kremlin may not be able to overcome in the longer run.

Reva Goujon [00:03:17] Right, while there may be plenty of wishful thinking in the Western media in looking at these elections and paying attention to things like opposition protests, and assuming that Putin himself could face an overwhelming challenge this year, that's probably not in the cards. We see Putin as having a pretty firm hold here. But, there certainly are tremors that point to some longer term challenges. What have we seen in terms of that building opposition in Russia?

Lauren Goodrich [00:03:44] Yes, one of the largest challenges for Russia is its economy. It's pulled out of recession this past year, but it's now settling down into a longterm stagnation. The economy itself is facing a series of financial crisises. There's a major banking crisis taking place right now in which hundreds of banks have been closed down in recent years. A good number of the big state firms have been asking for bailouts. Regional governments are tottering towards bankruptcy. All of this has really threatened the Kremlin's ability to maintain economic stability. The Russian people themselves are facing increasing poverty and unemployment. This past year saw over 1100 protests, and 2/3 of those 1100 protests were due to the economy. And this is something that has really channeled into the opposition groups that are on the rise. We saw a very pivotal signpost in September in which the regional elections that took place, we saw some very large and notable gains from opposition groups, and very liberal opposition groups that haven't really been players in years.

Reva Goujon [00:04:51] In looking at this prolonged stagnation in the Russian economy, the effect that's having on the Russian people, a leader like Putin who has been in power for so long, even while he still may be quite strong, and effective at managing very tense power relations within the Kremlin and in managing any potential backlash among the Russian people, the longer you stay in power, the more creative you have to get in holding on to it. And the more extreme you have to get in the measures to hold on to that power. With that questioning of Putin's credibility the longer he holds on, what measures have you observed that the government has taken to try to preempt any challenge, at least coming through elections or opposition groups?

Lauren Goodrich [00:05:36] We've seen the Kremlin move very aggressively in recent years to centralize the government even further into a much more autocratic regime. The Kremlin has been pouring an incredible amount of resources within the security apparatuses, even creating a whole new guard just for Putin, the National Guard, which is wholly loyal to Putin himself. This signals that Putin is not only worried about what's happening on the streets, but also challenges within the Kremlin itself. We're also seeing the state take on much more responsibility for the economic and financial stability of the country itself. We're seeing the state nationalize the banks, really have to pay for the pension funds that were outside of Kremlin control. The Kremlin right now is discussing on whether they're going to have to, out of their federal budget, have to pay for some of the state firms' salaries, for the employees, to keep the employees happy. Overall, the Kremlin in taking on an unprecedented bandwidth of responsibility that we haven't really seen since the fall of the Soviet Union. And this is something that has really worried a lot of the more financially or economically minded people inside the country, because they're worried that the Kremlin is overreaching at this time, because the Kremlin still is facing some very strong financial challenges with oil prices moderately low, not as low as they used to be of course. And then the Kremlin is also challenging any dissent that takes place within the state itself, particularly out of the regions. Putin has replaced 19 governors this year, that's a record for him.

Reva Goujon [00:07:13] And so what does that then mean in the lead-up to those regional elections in September, where those governor positions are going to be quite critical?

Lauren Goodrich [00:07:19] The governor positions, but more so the district positions, because we're starting to see the district positions be the one where the opposition can actually win. The governor positions are a little more difficult, because Putin has to sign off, on who you are as a governor. And so he can just not approve you, if you're opposition. But those districts are really important because it sets the tone within certain regions or certain cities, whether they're going to be compliant with Kremlin policy, and with Kremlin crackdowns, or whether they're going to push back on the Kremlin and its policies.

Reva Goujon [00:07:53] And when it comes to the popularity of opposition candidates, and their intent of spreading their message through tools like social media, what are some of the measures we've seen the government take to try to preempt that?

Lauren Goodrich [00:08:05] The Kremlin has been very focused, or hyper-focused, on media and social media in recent years. There's a series of foreign media laws in which the Kremlin is cracking down on almost any foreign media outlet inside the country. It's very hard for them to give opposition leaders platforms in which they would be able to speak to the Russian people from within Russia. It's different than having an opposition leader talk to a foreign media outlet, say in London, and then it broadcasts into Russia. And then the Kremlin has also really cracked down on social media by restricting VPN as well as denying the ability for anonymous users to use the internet inside of Russia, and this has really helped the Kremlin, and particularly security apparatuses, have that transparency to where they know who to go after, who's spreading opposition messaging, or spreading anti-Putin messaging, or organizing protests. And so the laws have been called draconian by everyone in the West, but for the Kremlin, this is their next frontier, is them being able to handle and shape and contain the social media messaging.

Reva Goujon [00:09:17] But even with those efforts to try to control the message, and prevent alternate viewpoints from reaching the Russian people through social media outlets, through foreign media, how effective can that actually be? It's hard to control access to information, as many governments, not just the Russians or the Chinese have observed, and so when it comes to, just the effectiveness of these measures in shaping an election, shaping that message and ultimately the outcome, what does that look like?

Lauren Goodrich [00:09:47] Well it's becoming increasingly more difficult even with all these new restrictions and laws. This is a whole new generation that knows how to use social media, versus a Kremlin of an older generation that is trying to learn what these kids are doing. And so the messaging is still rampant. Many opposition leaders have their own social media platforms across many various boards in which they can just hop from one to the other. The Kremlin has shut down so many opposition groups' websites or YouTube channels, or prevented them from being able to stream inside of Russia, but it can only go so far to where, that next generation has found out the next place to go.

Reva Goujon [00:10:29] I'm curious Lauren, as we've seen in this country, when President Trump harnessed social media tools, especially like Twitter, to get his, albeit controversial, message out at times, do we see an effort, or an interest by Kremlin leaders including Putin, to do something similar? To at least become part of the conversation, and use some of these tools as an extension of their propaganda?

Lauren Goodrich [00:10:57] Well, Putin has personally prided himself on not being very tech savvy. He depends on on pen and paper, pretty much. Though many around him have tried. When Medvedev became president, for his brief four years, he attempted to be the Twitter president. He saw what was taking place here in the United States and tried to take advantage of that. I mean there was the tour of the Apple, you know, iPhone factory in California, and he got the latest model, and he was on Twitter quite a bit, however, it just never took to the people. There was something almost phony about Medvedev's attempts.

Reva Goujon [00:11:35] Like too forced or something?

Lauren Goodrich [00:11:37] Too forced. What is interesting this time around, is that there is a current shift in tone going into this presidential election out of the Kremlin and Putin's candidacy. There have been leaks out of the Kremlin in recent weeks that Putin is not going to be issuing his very traditional, lengthy diatribes in the media, that no one reads. Instead, he's going to likely do these small, short sound bites that social media can pick up, instead of going to traditional media and having a three-page op-ed. And so Putin is trying to make things shorter, more compact, more digestible. That way they can get it onto the platforms that this next generation reads.

Joshua Cook [00:12:21] We'll get back to our conversation on Russia and the upcoming 2018 elections there, in just a moment. But first we want to share a brief commentary from Strafor Chief Security Officer Fred Burton, reflecting on another point in history where Russian intelligence was very much focused on the U.S. presidency.

Fred Burton [00:12:50] While I was looking through the recently released JFK documents, one item in particular caught my eye: an FBI letterhead memorandum, or an LHM as they call it in the business, from December 1966. The LHM is a fascinating but startling, declassified top secret report from then-FBI director J. Edgar Hoover to the White House. In it, Hoover relays a reliable source's account of the Soviet response to Kennedy's death. Two days after the shooting, the source said, "The chief of the KGB stated that Kennedy's assassination posed a problem for the Soviet intelligence agency. The KGB chief also said he believed an organized group was behind the act, rather than a lone perpetrator." Later in the report, Hoover describes information that the FBI received from the same source in September 1965 suggesting that Moscow suspected Kennedy's vice president and successor Lyndon Baines Johnson as the mastermind behind the assassination. The LHM doesn't disclose the identities of the KGB or the FBI sources, though I would speculate that some degree of human intelligence was involved. As a young special agent with the State Department, I learned firsthand that sometimes a case may have more to it than first meets the eye. Complex investigations like the one I participated in to find what caused the plane crash that killed President Zia of Pakistan, along with the U.S. ambassador, are rarely black and white. Furthermore, any high profile attack entails two parallel investigations. The first investigation centers on the hard facts, the who, what, where, how, and why.

Fred Burton [00:14:33] The second delves into the secret and highly compartmentalized intelligence files, and rarely do the people working one side of the case compare notes with the other. But other times, a case is no more than it appears to be, even if it's hard to believe. The human mind finds it hard to imagine that a single actor could alter the course of history with an attack he or she planned and executed alone. At the U.S. Secret Service Academy however, you learn that history is littered with examples of lone assailants who managed to do just that.

Joshua Cook [00:15:09] If you'd like to read Fred Burton's full commentary, part of his Lessons from Old Case Files series on Stratfor Worldview, we'll include a link in the show notes. If you're not already a Worldview member, you can learn more about Individual, Team, and Enterprise memberships at worldview.stratfor.com/subscribe. And now back to our conversation on Russia with Strafor's Reva Goujon and Lauren Goodrich.

Reva Goujon [00:15:38] We are seeing some adaptation by Putin and members of the Kremlin to appeal to this generation, but there's still a bigger challenge ahead, wouldn't you say, when we look at especially those born after the fall of the Soviet Union who don't share necessarily the experience of their elders in the very tumultuous '90s, and seeing kind of the negative effects of embracing too liberal policies or you know, seeking engagement with the West. And so, in trying to appeal to this emerging demographic, what are the challenges that lie ahead?

Lauren Goodrich [00:16:14] This is a very different new generation coming out inside of Russia. Around 1/3 of the current population of Russia was born after the fall of the Soviet Union, and they are entering the workforce now. And so for Putin, he came into popularity off of the wave of being the savior of Russia. And this generation doesn't remember needing saving, and doesn't remember a time before Putin and his autocratic government were in place. This new generation is very politically active; that's very different than their parents, and their predecessors, in which they prefer to just accept what the Kremlin told them, via messaging, via propaganda, and how Russia needed to operate. They were willing to accept autocratic power because at least it was stable. To where this next generation is much more politically active, much more hooked into social media, and connected across Russia, not just in certain cities. And they're also tapped into the outside world. Now, this doesn't mean that this next generation is anti-Putin, or anti-regime. But what they want, is they want options. They want the ability to shape their country.

Reva Goujon [00:17:29] Right, they've only known one leader for most of their lives, right?

Lauren Goodrich [00:17:33] Yeah, and they don't feel they can really shape the future of their country because they don't have any say whatsoever, only Putin has say.

Reva Goujon [00:17:41] And there's maybe less trust in "The state knows best."

Lauren Goodrich [00:17:44] Very much so, and so this is the generation that we're starting to see protest. In the recent protests in 2017, all across 2017 especially in June, they were young people on the streets. I mean very young, there were high schoolers on the streets, with very politically succinct ideas, and clear messaging, and they weren't just angry or raging, they just wanted to start that dialog of, "We need choice."

Reva Goujon [00:18:08] And so when we look at some of these bigger, more structural challenges that the Kremlin is facing, Putin in particular, in leading this transition, what are the parallels that you see, in the period after Brezhnev?

Lauren Goodrich [00:18:23] The period right now that Putin is entering is strikingly similar to the end of Brezhnev's period and post-Brezhnev period. The Soviet Union was in economic disarray, even though most of the Soviet people did not know it yet. The country was embroiled in war in Afghanistan. Tensions with the United States were back at a new height. And the Russian people were starting to discover what the West was living: Coca-Cola commercials, music, fashion, consumerism, and the Russian people started to wonder why they did not have that if they were the powerful Soviet Union. And so there was a simmering discontent among the people, and that was something that the Soviet Politburo really started to recognize, and started to worry about. And that's what led to the rise of Gorbachev and Gorbachev's attempts to try to reform the system while maintaining the system. The problem was, the Soviet Union could not do both. It either had to revolutionize the system, or just maintain the status quo as long as they could. And the Soviet Union collapsed. And that is something that I think that Putin is really taking seriously right now, in which he's starting to think about and discuss reforms, but he doesn't know how to reform the system while maintaining the current regime. And that's his big challenge right now. And it's something that he can prolong for a few more years but probably not much longer.

Reva Goujon [00:19:55] And so, the lessons learned, because Putin knows his history well, and the experience of the Soviet collapse resonates very deeply with him, in shaping his experience and his vision for Russia. Given that, and the looming challenges that he is very aware of, what lessons can he apply to the current dynamic?

Lauren Goodrich [00:20:20] We're seeing Putin think about how to manage his upcoming years on multiple levels. We're starting to see some younger generation figures move into regional positions. Yes they're loyal to Putin, but they're not that old face that is loyal to Putin, it's a new face. We're starting to see Putin really take seriously the suggestions of economic and financial reform from former finance minister Alexei Kudrin. And we're starting to see Putin allow discussions on state media television and within state commentators, on saying who's going to succeed Putin. And the question of succession has been highly taboo for the last 17 years. And it is something that is starting to be very regularly discussed inside of Russia by the actual state messaging systems. That's pretty unheard of, and pretty remarkable, and it shows that the Kremlin is starting to get the Russian people ready for, there will be a life after Putin. The problem then is, how do you implement it after that? And I have a feeling that once Russia gets through these elections this next year, we're going to start to see little trickles come out of the Kremlin on how they're going to start laying that succession plan.

Reva Goujon [00:21:36] Life after Putin, that's a question that may not necessarily be a big one for 2018. This is of course, a year where we will see Putin extend his term, but in the years ahead, that certainly is going to be an important question given the challenges that lie ahead for the Russian state. You can bet that is where Stratfor will have its focus. Thank you Lauren for joining me today.

Lauren Goodrich [00:22:00] Thank you.

Joshua Cook [00:22:12] That's it for this episode of the podcast. For more on the latest developments in Russia, or our longterm forecast for the region, we'll include links to related analysis in the show notes. Now, all of our podcast conversations reflect the broader geopolitical assessments, commentaries, and forecasts available on Stratfor Worldview. If you're not already a Stratfor Worldview member, be sure to visit us at worldview.stratfor.com/subscribe to learn more about Individual, Team, and Enterprise level access. Worldview members can also continue this conversation about Russia and its upcoming election season in our members only forum. Have a comment or idea for a future episode of the podcast? Email us at podcast@stratfor.com or give us a call at 1-512-744-4300 extension 3917 to leave a message. And if you have a moment, also consider leaving us a review on iTunes or wherever you subscribe. We'd love to hear your feedback. And thanks again for joining us for today's conversation. For more geopolitical intelligence, analysis, and forecasting that brings global events into valuable perspective, follow us on Twitter @Stratfor.