Dire forecasts

Just after I got done trying to convince an American colleague who works in London that there will not be a financial crisis in Russia in the near future, I boarded the plane back to Moscow and started reading the Moscow Times opinion pages:

Bright People in Senate Will Not Save Kremlin
By Nikolai Petrov, Thursday, February 17, 2005. Page 9.

[...] Political stability now hangs by a thread. This thread is not the president himself but his popularity, constantly slipping of late. The state is rapidly losing its institutions and its legitimacy. And instead of looking for new sources of support, the government keeps destroying the ones it has. Putin continues to rely on the siloviki and law enforcement, who are helpless when large groups of protesters unite. One would think the month of protests would have made this obvious, but no, the Kremlin continues to dig its own grave.

On the other hand, maybe Putin will still have the chance to pull things together thanks to his opponents' utter disorganization:

Opposition Is Still Headless
By Boris Kagarlitsky, Thursday, February 17, 2005. Page 9.

[...] While the spontaneous protests in January scared the authorities, these demonstrations should come as a relief to officials. They proved once again how utterly powerless the opposition is. Opposition leaders can still get people lined up for a march, but they have no clue where to lead them. [...]

I still think the economic fundamentals will prevent a 1998-style crisis from occurring in the coming year, but events may prove me wrong, since investors in Russia are still easily spooked by signs of economic and political instability and may head for the exits en masse with little provocation.

Signs of discontent in the armed forces (the article from Grani.ru is in Russian; this is important enough to translate, but by the time I have a few minutes to do it someone else probably will already have it done) are not encouraging for the regime or for investors who would like to see a stable investment climate at all costs; they should, however, be encouraging to the Kremlin's various opponents. Any experiment at creating Soviet-style rule ultimately fails when the troops refuse to fire on the protesters.