Foreign affairs 2016 05-06

/• MAKING AMERICA GREAT AGAIN • • PUTIN'S RUSSIA MAY/JUNE 2016 Putin's Russia Down But Not Out F O R E I G NAF FAI R S .C O M

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Volume 95, Number 3 PUTIN’S RUSSIA 2 Russia’s Perpetual Geopolitics Putin Returns to the Historical Pattern Stephen Kotkin Russian Politics Under Putin 10 The System Will Outlast the Master Gleb Pavlovsky Russia’s Constrained Economy 18 How the Kremlin Can Spur Growth Sergei Guriev COVER: RICARDO MARTÍNEZ ORTEGA The Revival of the Russian Military 23 How Moscow Reloaded Dmitri Trenin Putin’s Foreign Policy 30 The Quest to Restore Russia’s Rightful Place Fyodor Lukyanov May/June 2016

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How Putin Silences Dissent 38 47 Inside the Kremlin’s Crackdown Maria Lipman 56 69 Why Putin Took Crimea 91 105 The Gambler in the Kremlin 116 Daniel Treisman ESSAYS America and the Global Economy The Case for U.S. Leadership Jacob J. Lew Making America Great Again The Case for the Mixed Economy Jacob S. Hacker and Paul Pierson The Once and Future Superpower Why China Won’t Overtake the United States Stephen G. Brooks and William C. Wohlforth The Fed’s Unconventional Monetary Policy Why Danger Lies Ahead Martin Feldstein The Fed and the Great Recession How Better Monetary Policy Can Avert the Next Crisis Scott Sumner ON FOREIGNAFFAIRS.COM Amanda Rothschild Susan Cheever on Milan Vaishnav on on ISIS and genocide. alcohol in U.S. history. Modinomics at two. May/June 2016

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The Fusion of Civilizations 126 136 The Case for Global Optimism 147 Kishore Mahbubani and Lawrence H. Summers 158 The Age of Transparency 165 191 International Relations Without Secrets Sean P. Larkin The Clean Energy Revolution Fighting Climate Change With Innovation Varun Sivaram and Teryn Norris REVIEWS & RESPONSES Reading Hume in Tehran The Iranian Revolution and the Enlightenment Ervand Abrahamian Recent Books Letters to the Editor “Foreign A airs . . . will tolerate wide di erences of opinion. Its articles will not represent any consensus of beliefs. What is demanded of them is that they shall be competent and well informed, representing honest opinions seriously held and convincingly expressed. . . . It does not accept responsibility for the views in any articles, signed or unsigned, which appear in its pages. What it does accept is the responsibility for giving them a chance to appear.” Archibald Cary Coolidge, Founding Editor Volume 1, Number 1 • September 1922 May/June 2016

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CONTRIBUTORS In 1982, GLEB PAVLOVSKY was arrested by Soviet authorities for distributing dissident literature and spent several years in internal exile. After the collapse o the Soviet Union, he became one o Russia’s premier political consultants, advising all three post-Soviet presidents before parting ways with Vladimir Putin in 2011. Now a prominent Kremlin critic and president o the Russia Institute and the Foundation for E ective Politics, Pavlovsky o ers an insider’s view o the Russian state in “Russian Politics Under Putin” (page 10). Over the past decade, the economist SERGEI GURIEV has worked at the center o Russian academic and political life—as the rector o Moscow’s New Economic School, an economic adviser to Dmitry Medvedev, and a member o the board o Sberbank, Russia’s largest bank. In 2013, under pressure from the Putin government, Guriev left Russia for Paris, where he is now a professor o econom- ics at Sciences Po. In “Russia’s Constrained Economy” (page 18), he argues that only major structural reforms can unlock the country’s potential for growth. During Russian President Vladimir Putin’s early years in power, MARIA LIPMAN experienced his regime’s crackdown on its opponents rsthand, when, in 2001, allies o the government seized control o Itogi, the newsweekly she had co-founded, and red the whole sta . Since then, she has written for The Washington Post and The New Yorker, and she now serves as editor in chie o Counterpoint, a journal published by George Washington University’s Institute for European, Russian, and Eurasian Studies. In “How Putin Silences Dissent” (page 38), Lipman examines how the Kremlin’s political suppression works in practice. JACOB LEW began his political career at age 12, canvassing for the antiwar Democratic presidential candidate Eugene McCarthy in 1968, and at 18, he became an aide to U.S. Congresswoman Bella Abzug. Having served as director o the O ce o Management and Budget twice (under both Bill Clinton and Barack Obama) and White House chie o sta (under Obama), Lew took his current position as U.S. treasury secretary in 2013. In “America and the Global Economy” (page 56), he explains why U.S. global economic leadership has never been more important.

PUTIN’S RUSSIA Over the past decade and a half, Fyodor Lukyanov puts Putin’s foreign Vladimir Putin’s Russia has policy in the context o the post–Cold been an economic dynamo and War era, and Maria Lipman traces how a basket case, an imperfect democracy the Kremlin maintains control by crack- and a tightening tyranny, a constructive ing down on dissent. Finally, Daniel diplomatic actor and a serial military Treisman provides an authoritative aggressor—sometimes all at once. The account o Putin’s decision to invade only constant has been surprise, as the Crimea, arguing that it was less a response zigging and zagging has left outside to Western moves or a deliberate act o observers, and even many Russians, imperial revanchism than the impulsive scratching their heads. gamble o a leader worried about losing a key military base. We asked several o the world’s leading Russia experts to take stock o the country Together, these articles suggest under Putin, analyzing where things are pessimism about the future o Putin’s and where they’re going. The result is a regime, which has glaring structural sharp portrait o a wounded but still weaknesses and limited prospects for powerful bear—a country strong enough advancement. But they also suggest that to demand attention and respect, yet too it does not pose a major imminent threat weak to impose its will on the world; to world peace and stability. The current proud o its history and traditions, yet chapter o Russia’s story is unlikely to too insecure to tolerate free political end well, yet external pressure or provo- activity; rich enough to spend vast sums cation seems likely to in ame the situation on pet projects, yet too corrupt and rather than improve it. Dealing with constrained to prosper. such a challenge successfully will require a careful hand and a combination o Stephen Kotkin kicks the package o with a whirlwind tour o Russian history, rmness, prudence, and patience. showing how today’s anti-Western resent- ment, centralized power, and sense o —Gideon Rose, Editor special destiny represent not aberrations but a return to the centuries-old norm. Gleb Pavlovsky, a former Kremlin insider, explains how politics works under Putin, highlighting the role o sistema, Russia’s deep state, in driving all major outcomes. Sergei Guriev and Dmitri Trenin assess Russia’s economy and military, respectively, concluding that the latter is doing much better than the former.

Throughout its history, Russia has been haunted by its relative backwardness. —Stephen Kotkin Russia’s Perpetual Geopolitics Putin’s Foreign Policy 30 Stephen Kotkin 2 Fyodor Lukyanov 38 47 RICARDO MARTÍNEZ ORTEGA Russian Politics Under Putin How Putin Silences Dissent Gleb Pavlovsky 10 Maria Lipman Russia’s Constrained Economy Why Putin Took Crimea Sergei Guriev 18 Daniel Treisman The Revival o the Russian Military Dmitri Trenin 23

Return to Table of Contents PUTIN’S RUSSIA Russia’s Perpetual History records three eeting moments Geopolitics o remarkable Russian ascendancy: Peter the Great’s victory over Charles XII and Putin Returns to the a declining Sweden in the early 1700s, Historical Pattern which implanted Russian power on the Baltic Sea and in Europe; Alexander Stephen Kotkin I’s victory over a wildly overstretched Napoleon in the second decade o the For hal a millennium, Russian nineteenth century, which brought Russia foreign policy has been character- to Paris as an arbiter o great-power a airs; ized by soaring ambitions that and Stalin’s victory over the maniacal have exceeded the country’s capabilities. gambler Adol Hitler in the 1940s, which Beginning with the reign o Ivan the gained Russia Berlin, a satellite empire Terrible in the sixteenth century, Russia in Eastern Europe, and a central role managed to expand at an average rate o shaping the global postwar order. 50 square miles per day for hundreds o years, eventually covering one-sixth These high-water marks aside, o the earth’s landmass. By 1900, it was however, Russia has almost always been the world’s fourth- or fth-largest indus- a relatively weak great power. It lost the trial power and the largest agricultural Crimean War o 1853–56, a defeat that producer in Europe. But its per capita ended the post-Napoleonic glow and forced a belated emancipation o the reached only 20 percent o the United serfs. It lost the Russo-Japanese War o Kingdom’s and 40 percent o Germany’s. 1904–5, the rst defeat o a European Imperial Russia’s average life span at birth country by an Asian one in the modern was just 30 years—higher than British era. It lost World War I, a defeat that India’s (23) but the same as Qing China’s caused the collapse o the imperial regime. and far below the United Kingdom’s (52), And it lost the Cold War, a defeat that Japan’s (51), and Germany’s (49). Russian helped cause the collapse o the imperial literacy in the early twentieth century regime’s Soviet successor. remained below 33 percent—lower than that o Great Britain in the eighteenth Throughout, the country has been century. These comparisons were all well haunted by its relative backwardness, known by the Russian political estab- particularly in the military and indus- lishment, because its members traveled trial spheres. This has led to repeated to Europe frequently and measured their frenzies o government activity designed country against the world’s leaders to help the country catch up, with a (something that is true today, as well). familiar cycle o coercive state-led indus- trial growth followed by stagnation. Most STEPHEN KOTKIN is Professor of History and analysts had assumed that this pattern had ended for good in the 1990s, with International A airs at Princeton University and the abandonment o Marxism-Leninism and the arrival o competitive elections a Fellow at the Hoover Institution at Stanford and a buccaneer capitalist economy. But the impetus behind Russian grand strategy University. had not changed. And over the last 2