Putin's Choice

Vladimir Putin can't seem to decide which of his two heroes he wants to be.

The tough guy KGB veteran in him clearly wants to follow the example of the late hard-line Soviet leader Yury Andropov. But another side of Putin yearns to emulate the reforming and modernizing tsarist-era Prime Minister Pyotr Stolypin.

For the first six months of his third term in the Kremlin, Putin was all Andropov all the time. From new laws cracking down on dissent, to the imprisonment of anti-Kremlin demonstrators, the shocking abduction and alleged torture of Left Front activist Leonid Razvozzhayev, the vibe oozed repression and regression.

But the sacking earlier this month of Defense Minister Anatoly Serdyukov over a defense-procurement scandal was widely interpreted by Moscow's chattering class as an important watershed and potential turning point for Putin's presidency.

"It seems that the third presidential term is going to be quite unlike a simple continuation of the previous two. Just like the situation in the country and in the world is quite unlike the one that existed in 2000-2008," political analyst Leonid Radzikhovskiy writes in "Nezavisimaya gazeta."

But a turning point toward what?

Some Kremlin-watchers, including many not favorably inclined toward Putin, view the Serdyukov sacking as a prelude to the president discovering his inner Stolypin and pivoting in a reformist direction in the coming months -- cracking down on corruption and restructuring the economy.

Others, however, see it as an ominous sign that Putin is gearing up to double down on repression and purge the elite of disloyal elements under the guise of an anticorruption campaign. The move would be reminiscent of Andropov's cleansing of the Soviet leadership during his brief 15-month rule, in which he fired 18 ministers and 37 regional party bosses.

Which interpretation is correct has broad implications for everything from the Kremlin's ongoing struggle with the opposition, to the intramural cold war within the ruling elite, to Russia's prospects for economic modernization.

Discovering His Inner Stolypin

With a long-awaited and badly needed restructuring of Russia's creaking social-welfare system stalled, foreign and domestic investment in the private sector drying up, and a budget crunch looming, any move toward reform, analysts say, would come more out of necessity than out of conviction.

But the repressive policies Putin has followed since May, some Kremlin-watchers say, now give him the political space to commence economic reforms in earnest.

"It is the best time to start a new round of economic liberalization, given the political freeze," Nikolai Petrov of the Moscow Carnegie Center wrote in a recent article in Slon.ru.

"For Putin, this is evidently his last chance to get on top of a situation which is objectively not going his way. And if he does not take advantage of the moment now, he will not have such an opportunity again. It is also important that the (excessively) repressive policies of recent months allow Putin to act as if from a position of strength, and not one of weakness."

Petrov notes that there are persistent rumors circulating in Moscow that Prime Minister Dmitry Medvedev's government is about to be replaced. And many eyes, he writes, are on former Finance Minister Aleksei Kudrin, "who seems to be continually waiting for something and is in no hurry to move into opposition to Putin."

In one sense, bringing in Kudrin and pushing through social and market reforms would be shrewd. Such a move would be cheered by the urban professional wing of the opposition, which reveres Kudrin and favors economic liberalization, but staunchly opposed by the Kremlin's opponents on the left.

Splitting the opposition in this way would give the Kremlin, which has been on the defensive most of the year, some breathing space.

I have long believed this was the real motivation behind the criminal probe against Left Front leader Sergei Udaltsov, who could prove dangerous in an environment of working-class and rural unrest.

But bringing back the widely respected Kudrin to save the Kremlin's economic bacon also has its risks. Kudrin has long argued that any successful economic liberalization must also be accompanied by political reform and increased pluralism -- something Putin clearly has no stomach for.

And even as his name is surfacing for the prime minister's job, Kudrin is clearly hedging his bets. As Kremlin-watcher Stanislav Belkovsky notes in "Moskovsky komsomolets," Kudrin is openly calling for early elections to the State Duma and has placed his ally, Dmitry Nekrasov, on the opposition's Coordinating Council.

Unleashing His Inner Andropov

One of the hallmarks of Putin's rule has been stability among the ruling elite. His people, his top ministers, members of his inner circle, were untouchable. The law, to quote a popular refrain from the opposition, was only for his enemies.

Serdyukov's sacking over a corruption scandal at Oboronservis, a military procurement company set up by the Defense Ministry, was seen as a sharp turn away from this "stability of cadres" approach.

"Now, nobody is untouchable," political analyst Leonid Radzikhovskiy writes in "Nezavisimaya gazeta."

"Suspicions of corruption are not being covered up and will not be covered up -- including at the highest level. The president knows the public's moods and takes them into account."

There have indeed been quite a few corruption scandals breaking out of late. In addition to the Oboronservis case that brought down Serdyukov and other top defense officials, there have been embezzlement cases involving the Global Navigation Satellite System (Glonass), financial wrongdoing connected to preparations for the APEC Summit in Vladivostok, and a financial scandal at the Health Ministry in Chelyabinsk, just to name a few.

So are we witnessing a real crackdown on official corruption?

Not quite, writes Yevgeniya Albats in "Novoye vremya." On closer scrutiny, she suggests, the Serdyukov case looks more like a settling of scores.

"Strangely, few people have drawn attention to the fact that in the last two years of Dmitry Medvedev's presidency, Serdyukov increasingly sought and found support specifically in the Kremlin rather than the White House, where Putin was installed at the time," Albats writes.

Most notably, Serdyukov relied on Medvedev's help -- over Putin's objections -- to increase the 2011 defense budget from 13 trillion rubles to 20 trillion rubles ($409 billion to $630 billion).

"It is clear why Medvedev needed an alliance with the minister of defense," Albats writes.

"While de jure he was the commander in chief, to whom all the siloviki are subordinated, de facto he controlled very few people: those same security policemen's loyalties lay exclusively in the prime minister's office. At that time Medvedev had started thinking seriously about a second term and had a vested interest in Serdyukov's support."

So now it's payback time.

"It appears obvious that Putin has started to be afraid of his own entourage.... Which means that that further high-profile cases and dismissals are in the offing," Albats writes.

If this is the case, Putin may be about to move to finally settle the intramural struggle about Russia's future that has been raging since the Medvedev presidency, and which has intensified since Putin returned to the Kremlin.

Which means that in addition to the ongoing crackdown against the opposition, we may be in for a comprehensive purge of the ruling elite under the guise of a war on corruption.

A False Choice?

So which will it be? A pivot to Stolypin-style reforms or a doubling down on Andropovism?

Politically speaking, the line between Putin's two role models is actually quite thin. Both sought to introduce measures explicitly designed to salvage an ailing autocratic system.

Serving as premier in the tumultuous period following the Russo-Japanese War, Stolypin initiated historic land reforms, expanded the Trans-Siberian Railroad, and facilitated the development of Siberia.

But his zeal for reform only went so far. Appointed by Tsar Nicholas II in the politically charged atmosphere following the revolution of 1905, Stolypin was obsessed with preventing further political upheaval. He was so ruthless in dealing with real and potential revolutionaries that the hangman's noose became known as a "Stolypin necktie."

And Andropov, when he became Soviet leader in November 1982 after Leonid Brezhnev's death, sought to introduce more effective management, stricter discipline, and very limited market mechanisms to make the stagnant Soviet economy more competitive. But his short-lived authoritarian modernization left little room for any inkling of pluralism. Instead, he kept the political system tightly controlled and the economy wedded to the state -- with the KGB taking a leading role.

So Putin may not need to choose at all. If he can achieve firm Andropov-style control over the political system and tame rebellious elements in the elite, he may feel sufficiently confident to pursue modernizing reforms a la Stolypin.

The Paradox

If Putin is indeed planning to pivot to a season of reform, Kudrin will most likely be a key figure.

When Kudrin resigned in September 2011, his stated reason was that he opposed the hike in defense spending Serdyukov had secured with Medvedev's assistance -- and over Putin's objections. Kudrin argued that the funds allocated for defense were needed to modernize the education, health-care, and social-welfare systems.

Was Serdyukov's removal the first step in a plan to dismiss Medvedev and make Kudrin prime minister?

Perhaps. But this begs a larger, more fundamental, question: Would Kudrin go along with an economic reform program without the political reforms he has repeatedly said must accompany it?

I have long argued that any true economic reform in Russia, any true diversification and decentralization of the economy, would in the long run lead to political decentralization and ultimately greater pluralism.

And this may be Kudrin's calculation -- compromising on political reform in the short run knowing full well that it will be unavoidable in the long term.

It's all speculation at this point. But the picture is bound to become clearer when Putin gives his annual address to parliament, which the Kremlin says should come by the end of the year.

-- Brian Whitmore