Putin fears another coup as Russia finally begins to buckle
This month, Russia’s Federal Security Service (FSB) accused Khodorkovsky, who now lives in exile in London, and 22 members of Russia’s Anti-War Committee of plotting a coup.
According to the FSB, the committee, which was created to oppose Russia’s war in Ukraine, is vying for “the violent seizure of power and overthrow of the constitutional order in the Russian Federation”.
Khodorkovsky says the allegations are lies. Kremlinologists say it is a clear sign of a new sense of vulnerability at the heart of the Russian state.
“It tells us that the Kremlin is being paranoid,” says John Herbst, the senior director of the Atlantic Council’s Eurasia Center and former US ambassador to Ukraine. “Putin is looking for enemies to try to bolster his regime.”
Suddenly, Putin has many reasons to be worried.
Russia’s economy is beginning to buckle. Businesses have been crippled by high interest rates, government borrowing costs have soared and economy minister Maxim Reshetnikov warned in June that the country was “on the brink of a recession”. Warnings are mounting over a potential avalanche of bad debt that could trigger a financial crisis.
Small pockets of protest are emerging. Earlier this month, hundreds of people gathered in St Petersburg Square to sing an outlawed song calling for Putin to be overthrown.
Meanwhile, Ukraine has been aggressively ramping up its drone attacks on Russian oil refineries, hammering the country’s petrol supplies.
Now Donald Trump is turning the screws. After frustration over a lack of progress to end the war in Ukraine, the US president announced new sanctions on two of Russia’s biggest oil companies on Wednesday.
India and China, the main buyers of Russian oil since the war began, responded by curbing purchases. It threatens to cut off crucial oil revenues to Putin’s war machine – and the Russian state.
“For the first time in three and a half years, Russia’s really getting hurt,” says Timothy Ash, an associate fellow at Chatham House’s Russia and Eurasia programme. “I think there’s some panic.”
Russia’s economy has so far been remarkably resilient during the war with Ukraine, defying predictions it would collapse after an initial wave of worldwide sanctions were levied.
One of the reasons why it has weathered the storm so far is because the Kremlin has pushed banks to lend to defence companies, rather than simply using state cash.
To do so, it gave them the green light to lend without the usual credit checks or reserves to cover potential defaults.
“They were funding the war with borrowed money all along, it just wasn’t showing on the state’s balance sheet,” says Craig Kennedy, of Harvard’s Davis Center for Russian and Eurasian studies.
Not only was this money lent without proper credit checks, but it has gone to a sector that has a bad credit history. All sectors in Russia are also grappling with the pain of high interest rates. The central bank rate hit a two-decade high of 21pc last October and now sits at 16.5pc.
Whatever happens, the money has now dried up. Last autumn, Nabiullina took steps to limit bank lending in an effort to rein in inflation, which peaked at 10.3pc in March.
“In terms of being able to buy victory on the battlefield, Moscow already understands it’s beyond their capability,” says Kennedy. “The longer they wait, the greater the risk of a crisis, because the debt situation isn’t going to fix itself.”
Khodorkovsky says Russia’s economic problems are not yet driving serious dissent at home. “The population notices the problems, but they are not yet severe.”
But Western sanctions have created significant problems for the country.
“The first is growing technological backwardness,” says Khodorkovsky. “Russia is becoming increasingly archaic, unable not only to produce innovations but even to adopt those of others. This is not very visible in the short term, but in 10 to 20 years it will lead to major problems.”
The second issue is Russia’s new critical dependence on China. Khodorkovsky says: “Putin’s war machine relies heavily on cooperation with the PRC. Xi Jinping could collapse the Russian economy and stop the war tomorrow if he chose to.”
China is a lifeline for Russia because it buys its oil. But Beijing is not supporting Moscow wholeheartedly.
At the start of 2024, China reinstated tariffs on Russian coal imports. At the same time, it has been flooding Russia with cheap steel imports and cars.
Domestic companies are struggling to compete. Avtovaz, the company behind Russia’s best-selling car, said in July it was considering shifting to a four-day working week because of plunging sales and foreign “price-dumping”.
There is another issue waiting in the wings. Russia’s public finances are spiralling into a mess.
Russia’s deficit is ballooning. Since the start of the year, the Russian ministry of finance has raised its deficit target for 2025 to 2.6pc of GDP, more than five times the 0.5pc it had expected at the start of the year and by far the largest annual deficit since the pandemic.
In cash terms, this would mean a deficit of 5.7tn rubles (£50bn). But the KSE Institute warned in September that the actual deficit will probably be even larger.
https://www.telegraph.co.uk/business/202...to-buckle/
This month, Russia’s Federal Security Service (FSB) accused Khodorkovsky, who now lives in exile in London, and 22 members of Russia’s Anti-War Committee of plotting a coup.
According to the FSB, the committee, which was created to oppose Russia’s war in Ukraine, is vying for “the violent seizure of power and overthrow of the constitutional order in the Russian Federation”.
Khodorkovsky says the allegations are lies. Kremlinologists say it is a clear sign of a new sense of vulnerability at the heart of the Russian state.
“It tells us that the Kremlin is being paranoid,” says John Herbst, the senior director of the Atlantic Council’s Eurasia Center and former US ambassador to Ukraine. “Putin is looking for enemies to try to bolster his regime.”
Suddenly, Putin has many reasons to be worried.
Russia’s economy is beginning to buckle. Businesses have been crippled by high interest rates, government borrowing costs have soared and economy minister Maxim Reshetnikov warned in June that the country was “on the brink of a recession”. Warnings are mounting over a potential avalanche of bad debt that could trigger a financial crisis.
Small pockets of protest are emerging. Earlier this month, hundreds of people gathered in St Petersburg Square to sing an outlawed song calling for Putin to be overthrown.
Meanwhile, Ukraine has been aggressively ramping up its drone attacks on Russian oil refineries, hammering the country’s petrol supplies.
Now Donald Trump is turning the screws. After frustration over a lack of progress to end the war in Ukraine, the US president announced new sanctions on two of Russia’s biggest oil companies on Wednesday.
India and China, the main buyers of Russian oil since the war began, responded by curbing purchases. It threatens to cut off crucial oil revenues to Putin’s war machine – and the Russian state.
“For the first time in three and a half years, Russia’s really getting hurt,” says Timothy Ash, an associate fellow at Chatham House’s Russia and Eurasia programme. “I think there’s some panic.”
Russia’s economy has so far been remarkably resilient during the war with Ukraine, defying predictions it would collapse after an initial wave of worldwide sanctions were levied.
One of the reasons why it has weathered the storm so far is because the Kremlin has pushed banks to lend to defence companies, rather than simply using state cash.
To do so, it gave them the green light to lend without the usual credit checks or reserves to cover potential defaults.
“They were funding the war with borrowed money all along, it just wasn’t showing on the state’s balance sheet,” says Craig Kennedy, of Harvard’s Davis Center for Russian and Eurasian studies.
Not only was this money lent without proper credit checks, but it has gone to a sector that has a bad credit history. All sectors in Russia are also grappling with the pain of high interest rates. The central bank rate hit a two-decade high of 21pc last October and now sits at 16.5pc.
Whatever happens, the money has now dried up. Last autumn, Nabiullina took steps to limit bank lending in an effort to rein in inflation, which peaked at 10.3pc in March.
“In terms of being able to buy victory on the battlefield, Moscow already understands it’s beyond their capability,” says Kennedy. “The longer they wait, the greater the risk of a crisis, because the debt situation isn’t going to fix itself.”
Khodorkovsky says Russia’s economic problems are not yet driving serious dissent at home. “The population notices the problems, but they are not yet severe.”
But Western sanctions have created significant problems for the country.
“The first is growing technological backwardness,” says Khodorkovsky. “Russia is becoming increasingly archaic, unable not only to produce innovations but even to adopt those of others. This is not very visible in the short term, but in 10 to 20 years it will lead to major problems.”
The second issue is Russia’s new critical dependence on China. Khodorkovsky says: “Putin’s war machine relies heavily on cooperation with the PRC. Xi Jinping could collapse the Russian economy and stop the war tomorrow if he chose to.”
China is a lifeline for Russia because it buys its oil. But Beijing is not supporting Moscow wholeheartedly.
At the start of 2024, China reinstated tariffs on Russian coal imports. At the same time, it has been flooding Russia with cheap steel imports and cars.
Domestic companies are struggling to compete. Avtovaz, the company behind Russia’s best-selling car, said in July it was considering shifting to a four-day working week because of plunging sales and foreign “price-dumping”.
There is another issue waiting in the wings. Russia’s public finances are spiralling into a mess.
Russia’s deficit is ballooning. Since the start of the year, the Russian ministry of finance has raised its deficit target for 2025 to 2.6pc of GDP, more than five times the 0.5pc it had expected at the start of the year and by far the largest annual deficit since the pandemic.
In cash terms, this would mean a deficit of 5.7tn rubles (£50bn). But the KSE Institute warned in September that the actual deficit will probably be even larger.
https://www.telegraph.co.uk/business/202...to-buckle/
teachings of the Bible are so muddled and self-contradictory that it was possible for Christians to happily burn heretics alive for five long centuries. It was even possible for the most venerated patriarchs of the Church, like St. Augustine and St. Thomas Aquinas, to conclude that heretics should be tortured (Augustine) or killed outright (Aquinas). Martin Luther and John Calvin advocated the wholesale murder of heretics, apostates, Jews, and witches. - Sam Harris, "Letter To A Christian Nation"
