The brewing popular revolution in Georgia and the probable fall of the Assad regime in Syria demonstrate that Russia is losing its few allies and proxies. In both cases, Moscow has failed to ensure that the current regimes will survive despite years of military and propaganda assistance. And the future looks even bleaker, as Russia itself stands on the verge of an economic meltdown.
Moscow projects its influence in two main ways: military intervention and political corruption. Syria has been an example of the former, as the Kremlin has militarily propped up the regime of President Bashar Assad since the start of the Syrian civil war in 2011 and operates two major military bases, the Tartus naval base and the Hmeimim airbase. Syria provides Russia with a crucial foothold in the Middle East from which its forces have access to the Mediterranean Sea and can use the country as a launching pad for operations in Africa. Without Syria, Moscow’s close ally Iran will also be weakened and its regional terrorist network disrupted.
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Georgia is an example of Russia’s political corruption, through which the Georgia Dream government was financed and assisted to steal the general elections in November and support Russia’s foreign policies. The massive disinformation campaign against the West through state-controlled media and social networks is reminiscent of Moscow’s attempts to control Moldova and Romania, while Georgia’s election manipulation resembles that of Belarus.
Domestically, Russia is experiencing intensifying economic stresses. The current level of defense expenditures, close to one-third of the state budget, is unsustainable and is destabilizing the civilian economy. International sanctions are biting harder than officials admit and are reducing Moscow’s access to technology, equipment, and software. The Russian ruble is on the verge of collapse following the U.S. Treasury Department’s sanctions on dozens of Russian banks.
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Moscow is depleting its financial reserves accumulated during periods of high energy prices and is unable to borrow on international financial markets. Natural gas revenues are falling, and the budget deficit is ballooning. Crude oil sales have kept Russia’s economy afloat, but oil now sells below the global price. And exports of refined oil are declining. Although Western energy sanctions were inadequate during the first two years of the war, they are now being expanded to limit Russia’s oil trade and diminish state earnings.
More than half of Russia’s population live directly off state subsidies, but the cost of living is rising, with rampant inflation, declining social services, and shortages of an expanding range of products. As the economy declines, some economists are warning that the population could turn against President Vladimir Putin.
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Moscow is also experiencing military manpower shortfalls and cannot continue indefinitely with the mass casualties in Ukraine. Although it has announced intentions to expand military rearmament and troop levels, in reality, financial constraints, demographic shortcomings, and sanctions on advanced equipment seriously limit these ambitions. Western intelligence estimates that over 700,000 Russian troops have already been killed or wounded in Ukraine and the numbers are accelerating. To prevent further military setbacks, the Kremlin may need to conduct mass mobilization, a highly unpopular move it has avoided because it can trigger another large exodus of young men and provoke social unrest in the large cities.
While NATO is bolstering its military spending in preparation for outright confrontation with Russia, China is benefiting from Russia’s weaknesses. It is insisting on cheap energy supplies, introducing the yen as Russia’s main foreign currency, and tying Moscow into economic contracts that will primarily benefit Beijing. Facing multiple domestic and international pressures, Moscow will need to focus on preventing another slide into economic chaos and social unrest, as witnessed before the Soviet collapse.
Janusz Bugajski is a senior fellow at the Jamestown Foundation in Washington, D.C., and author of two new books, Pivotal Poland: Europe’s Rising Power and Failed State: A Guide to Russia’s Rupture.