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President Medvedev's Project Of Modernization

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For the past year, the Russian President Dmitry Medvedev has launched an ambitious modernization strategy that has the potential to transform Russia and improve strained relations with the West.

In September 2009, Medvedev published a groundbreaking article "Go Russia!", in which he set out his wide-ranging plans to modernize Russia's economy and society. In key speeches in July 2010 and at the Global Policy Form in Yaroslavl about ten days ago, he linked this to Russia's political system and foreign policy. All along his interventions have been one long argument that modernization and democracy are interdependent and mutually reinforcing. While insisting that there is democracy in Russia, President Medvedev recognizes that Russia's democratic system is "young, immature, incomplete and inexperienced" and that it needs to learn from both the successes and failures of other nations.

As such, he is charting a proper Russian way that differs from the dominant development strategies in the West and in China. The West views democracy as a precondition for proper economic modernization and lasting prosperity, as President Obama's adviser Michael McFaul argued at the Yaroslavl Forum. For its part, China since 1979 considers sustained economic growth as the best means of democratizing the state. By contrast, the Russian President is convinced that the West and China posit a false choice. Just as economic modernization requires and fosters democratic institutions, so political modernization is unsustainable without lasting economic growth.

Both at home and abroad, liberal critics of Medvedev dismiss his modernization strategy as little more than window-dressing that masks his determination to preserve the ruling regime led by Prime Minister Vladimir Putin. Modernization Medvedev-style, so the critics claim, is too narrowly focused on technology and won't work without wholesale political liberalization and legal reform that will certainly be blocked by Putin and the siloviki faction (coming largely from the security services) which dominates Russian government and state corporations. Pointing to a succession of recent polls, the liberal commentariat accuses the president of ignoring popular calls for a systemic form of modernization that can offer a new social contract.

Critics have a point but fail to see the bigger argument. Since he took office, Medvedev has crafted a transformational vision for Russia's domestic politics and foreign policy. The ongoing economic crisis and the aftermath of the war with Georgia have persuaded the president that the old, conventional approaches and measures are outmoded and don't serve Russian or global interests. Based on a critique of the status quo, Medvedev has begun to chart an alternative path that outflanks both liberal and conservative ideology. His proposed 'third way' gestures towards a pluralist account of the state and the market - fostering groups, intermediary institutions, small-and medium-sized enterprise as well as regions instead of relying exclusively on the individual citizen and the executive branch of government.

In short, Medvedev's ambition is to overcome the Soviet legacy of individual atomism and statist collectivism - when totalitarian state structures undermined social bonds of reciprocal trust and mutual cooperation. Without more human and social capital, Russia can neither modernize nor democratize.

Moreover, Medvedev's project of modernization is not at all limited to national issues. In terms of Russia's role in the world, the President's strategy suggests a stronger emphasis on forging links with countries and organizations that offer mutually advantageous cooperation - starting with the export of primary resources in exchange for technology and investment. Chief of all, Medvedev looks to the U.S. and other member-states of the OECD in order to reinforce bilateral relations. Likewise, he pursues multilateral projects such as WTO membership and the new 'partnership for modernization' with the European Union. The creation of an innovation hub in Skolkovo, near Moscow, is a first sign that the President means business. Thus far, this Silicon Valley Russian-style is more show than substance, but it demonstrates the Kremlin's commitment to bring together the state, industry, the financial sector and university research to craft an industrial policy that can help Russia compete in the global economy.

In addition to better ties with the West, Medvedev also seeks closer ties with emerging markets as part of new pan-regional associations such as the Eurasian Economic Community or the BRIC group, an expression of Russia's 'multi-vectored' foreign policy that provides greater opportunities to shape the international system. That's what underpins Medvedev's project of democratic modernization, social renewal, a new Euro-Atlantic security framework from Vancouver to Vladivostok and reforms of global governance (including financial reform at the level of the G20).

All this is set out in his major foreign policy address of 12 July 2010, in which he argues that the global economic crisis has brought about a "paradigm shift in international relations [which] opens for us a unique opportunity to put Russia's foreign policy instruments to the most effective use possible to assist the country's modernization." Central to his overarching vision is the argument that neither the individual nor the state can exercise their sovereignty and power without some form of association with other individuals within and across regions and nations.

Of course, all this could come to nothing very significant at all. Many members of the ruling political and economic elite seem to have a higher stake in their own power and wealth than in changing the country or the world. But at the same time, there are certain political developments indicating that change is underway. First of all, Medvedev's modernization strategy has already changed the terms of debate within the country and between Russia and other powers. Nor can this be dismissed as mere rhetoric void of any content. On the contrary, real transformation requires powerful ideas. The economist John Maynard Keynes was right when he said that "[T]he power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. Ideas [...] both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else."

Second, besides much-vaunted projects of technological innovation and reforms to diversify Russia's economy away from commodity dependence, President Medvedev has also modernized aspects of the political and judicial system - reforming local elections, firing many low- and middle-ranking officials, launching ambitious plans to overhaul health and education as well as replacing long-standing governors. Since he has not yet restored regional elections of the executives or facilitated multi-party competition, none of this amounts to a systemic transformation.

But the differences with the former president and current prime minister Vladimir Putin are stark. For example, Medvedev has denounced the Neo-Soviet personality cult surrounding Stalin and refrained from heavy state regulation of the internet where vibrant political debates are taking place. Just as ideas change reality, so does symbolism. Genuine gestures of reconciliation with Poland following the air crash killing the former Polish president underscores Medvedev's commitment to forward-looking relations rather than reactionary nostalgia.

Third, President Obama's "reset" could hardly have happened without President Medvedev's dedication to cooperative engagement as part of the modernization project. The new START treaty on nuclear arms reduction is only the beginning of a much wider strategy to forge strategic links in a number of areas such as defense policy and trade. The thaw in US-Russian relations has already led to a more positive dialogue within the NATO-Russia Council and is fostering mutual trust which alone can prevent future conflict.

Russia is still rife with corruption, violation of human rights, uncertain property rights and a lack of political competition. However, President Medvedev's project of democratic modernization offers a gradual strategy to bring about some degree of political and economic renewal. For now, that is Russia's best hope of building a functioning democracy and market economy.