MOSCOW (Reuters) — Surrounded by faithful
aides, President Vladimir Putin hears no opposition to his plans in
Crimea, allowing him to drive Russia's bid to reclaim Ukraine's southern
region guided by little more than his "inner voice".
Former and current officials paint a picture of a leader who
counts on the unswerving loyalty of a handful of advisers from his
administration and security services to draft policy that has
plunged relations with the West to a new post-Cold War low.
That the seizure of Crimea, home to Russia's Black Sea Fleet, could
tip a faltering economy into recession, spark visa bans and asset
freezes on top officials and isolate Russia in ways not seen since
Soviet times have not been considerations.
Those who disagree with his policies, fearing Putin may be ushering
in a period of economic stagnation, have not yet spoken out against
a leader who has successfully whipped up nationalist fervor over the
"brotherly nation" next door.
For the time being, Putin can rely on a system of control he has
honed and cultivated since he first came to power 14 years ago. It
is a closely marshaled hierarchy of loyalty where even debate and
disagreements are often choreographed for the benefit of state
television stations which film government meetings.
But the Crimea move has led to mutterings of discontent, mostly
among the financial and economic ministries, who were cut out of the
meeting when it was decided to act over a region Putin felt might be
lost forever if Kiev's new leaders were successful in taking Ukraine
into the European Union.
"His closest adviser is his inner voice," said a source who is close
to the Kremlin. "He had to act. He had no choice."
Sources say Putin took the decision on Crimea with his closest
advisers: Sergei Ivanov, head of the presidential administration,
Kremlin strategist Vyacheslav Volodin, Kremlin aide Vladislav
Surkov, Foreign Minister Sergei Lavrov and the heads of the security
services.
The response was unanimously in favor of action. Within days,
Russian forces had occupied the peninsula and a new Russian
separatist leadership was placed in charge, preparing for a
referendum to secede from Ukraine and join Russia.
GOOD EXCUSE
Putin has since said Russia has not been acting in Crimea but
allowing local self-defense units to act spontaneously, an assertion
derided as "Putin's fiction" by Washington.
There was little he had to do, former officials and analysts said.
Russian forces already based there, with the help of special forces,
mobilized to seize the peninsula, a favorite summertime resort for
Russians.
In Russia, the action is widely seen as a legitimate response to
Western support for the demonstrators who toppled pro-Russian
President Viktor Yanukovich last month.
"It's like if you're watching television with a neighbor and the
program's finished but then they try to run off with the television.
You cannot let them get away it, can you?" said the source.
The tough response showed a type of behavior that has marked Putin's
long rule but has been seen more often in recent years as the more
liberal thinkers who once influenced him have been pushed out of his
closest circle.
By excluding the finance and economy ministries, he deliberately
shut out advisers who might have urged caution.
Russia's economy was already in danger: growth has dropped and
should fall further this year, and investment flows are paltry.
Finances are still dependent on oil prices more than 20 years after
the fall of the Soviet Union.
Just the threat of Western sanctions has already hurt: the central
bank was forced to hike interest rates and burn through billions to
prop up the ruble. But Crimea may also help change the subject from
economic troubles that would have been inevitable anyway, and shift
blame to the West.
"He knows he cannot do anything about the economy ... Crimea is a
very good excuse for Putin," the source said.
Nevertheless, those who guide economic policy are worried that
Crimea could turn tough times into a full-blown recession.
"It's a
little bit frightening thinking about what will happen. I do not see
the whole picture and can only judge on fragments. It seems to me
that this is high stakes poker when both side bluffs big time," one
well-placed official said.
"The risks, in my opinion, are big and the losses could also be
large too."
VILLAS IN NICE VS. COURT IN THE HAGUE
The European Union and United States have viewed sanctions against
Russia with some reluctance, especially in Europe, which depends on
Russian natural gas. So far, measures discussed are aimed mainly at
the elite, in the hope of prodding those close to Putin to change
policy without fundamentally altering trade.
Washington has ordered visa bans and assets freezes on an
as-yet-unpublished list of individuals it blames for threatening
Ukraine's sovereignty. Brussels is threatening asset freezes, travel
bans and other sanctions.
However, Putin could also use the sanctions threat to his own
advantage by presenting it as a loyalty test: since he returned to
the presidency two years ago, he has told politicians to close their
foreign bank accounts.
Wealthy Russians may find it hard to complain in public about losing
access to banks and vacation homes in the West. So far, oligarchs
have largely kept silent, restricting their comments to saying their
businesses are unaffected by events.
One rare exception is tycoon-turned-politician Mikhail Prokhorov,
owner of the Brooklyn Nets basketball team, who called for
international cooperation over Ukraine, warning the "longer we take
in finding a resolution, the more it will cost".
For now, officials will be reluctant to challenge Putin's position
for the sake of a visa. Some may lose money, but they would have
been likely to do so anyway as the ruble weakens. Any economic pain
will probably not be enough to force Russia's rich and powerful to
abandon the former KGB spy.
"Yes our elite won't like it very much, but it has no other
options," Konstantin Simonov, general director of the National
Energy Security Fund, wrote in the Vedomosti newspaper.
"The West, in essence, proposed a tough choice: Bring us Putin's
head and you will keep your villas in Nice. But the elite does not
just fear Putin. They also don't believe the West, thinking it could
abandon them. Better to have a villa in Hong Kong or Thailand than
end up in court in the Hague."
(Additional reporting by Polina Devitt and Katya Golubkova;
editing
by Peter Graff)
