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The election of Barack Obama as President means that he now joins President Dmitry Medvedev as the first post-baby boom leaders of their respective nations. Because the two leaders are so clearly of a new generation, they have the most opportunity to finally succeed in breaking the old patterns of distrust and disengagement between the United States and Russia.
The success of "state capitalism" – a capitalist economy run with a high degree of state control – has made it a model for states across the developing world. Western powers may now be wondering whether their brand of capitalism will triumph after all.
The recent changes made to Russia’s regional leadership shows that neither Medvedev’s presidency nor the financial crisis has changed the Kremlin’s approach in appointing ‘strongman’ regional leaders. But it also shows that the range of opportunities open to the Kremlin to reform the regions has narrowed significantly.
In this phase of the financial crisis, struggling countries are looking to rising powers for help, rather than turning to the conditional aid traditionally offered by the IMF. This trend highlights the shifting global financial order and indicates that emerging powers will undoubtedly play a larger role as the international community attempts to define a new global financial system.
A key factor in Sunday’s national Russian elections was that parties lacking State Duma representation were denied registration. This is part of the current Kremlin strategy to purge the political field. But the grim economic situation makes this effort, and the election of deputies doing little more than passing along instructions from the top, morally obsolete.
Russia’s actions in the Russia-Georgia conflict proved that for the Kremlin, foreign policy is the crucial means of carrying out its domestic agenda. For the political elite, this agenda maintains the status quo. However, such a policy is unlikely to stand. Should Russia be unable to start to reform it risks collapse and repeating the end of the Soviet Union.
Relations between Russia and the U.S. have entered a dangerous stalemate. America cannot accept Russia's aggressive posture, but U.S. anger is only making the situation worse. Because of this political climate the foundations of U.S. policy toward Russia must be revised, starting by acknowledging Russia’s security interests.
Putin’s role in Russia currently remains unclear. Amidst the transition of the U.S. government, this factor will hinder U.S.-Russia relations. However, a bilateral commission made up of past U.S. and Russian presidents, with Putin serving the role of past president, can alleviate this problem.
Medevdev’s recent visits to the Far East reflect Russia’s geopolitical interests: to strengthen its presence in the Arctic and Asian-Pacific Rim. The visit also focused attention on the region’s economic and depopulation woes. While Medvedev’s response to the problems contrasts sharply with Putin’s optimistic statements, it remains to be seen whether Medvedev can provide a better cure.
New leadership in Moscow and Washington will soon face decisions that will reshape the U.S.-Russia agenda and set new priorities. The governments both countries should not succumb to the political inertia that has followed the Caucasus conflict. Instead, they must show reflection and restraint.
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