Sergei Guriev: "I am not a traitor for Putin, only an enemy"
Oct 2022
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Liberal economist and Kremlin critic
Sergei Guriev knows the Putin system intimately. Because he was too liberal for Moscow, he had to flee. Now he tells us who Putin still listens to, what the Kremlin leader is doing in the crisis - and how serious the nuclear threat is.
This interview by Mario Stäuble was originally published in German by Swiss daily «Tagesanzeiger», 28 September 2022. Translated and edited for layout purposes by the UBS Center.
Mr. Guriew, with your permission, we would like to turn back the time, to your old life.?
With pleasure.
It is spring 2013, the Russians have not yet occupied Crimean Peninsula. You are an influential economist in Moscow, serving as dean of the prestigious New Economic School. You worked as an advisor to former President Dmitry Medvedev. You sit on the board of Russia's largest bank, Sberbank.
Correct.
Explain to us: what happened back then?
I have to say first: I never worked as a formal employee of the government. I was a member of various external advisory bodies to both Putin and Medvedev. But I never worked for them.
Is so noted.
I was very concerned at that time that Russia was moving in the wrong direction. Vladimir Putin had come back to power a year earlier; it was clear even then that he didn't want liberal policies. He restricted freedom of assembly. He had the Pussy Riot female rock band jailed for two years just for singing in a church. He introduced a law against homosexual "propaganda." These were attempts to unite Russians by propagating conservative values. Only: it didn't work.
What happened instead?
His popularity declined, and this was because the economy was doing badly. So a year later annexed the Crimean Peninsula, which gave him a boost. You have to keep this strategy in mind for later.
We will. Back to you.
I wrote about all these problems. I published texts: We have to fight corruption. We have to limit the state if we want to have economic growth. Putin did not like that. Through mutual friends, he let me know that I should talk less. To use his words, "Shut the f*** up!"
You saw yourself as a fighter for a liberal Russia.
I was not a politician, not a street fighter. I was a well-known intellectual who supported democracy and a market economy.
Yet you felt threatened by Putin.
Read the famous Russian dissident Sergei Dovlatov. He said, "The communists forgive you if you make one mistake. But several mistakes are too many. And I was a dissident, a Jew, an alcoholic." He was also a journalist, by the way ...
You also committed "several mistakes"?
I wrote an analysis of a case against the oligarch Khodorkovsky, who was critical of Putin - I said there was no evidence of his guilt. I supported Alexei Nawalny ...
... the well-known opposition figure ...
... I was one of the first donors to his foundation, along with my wife. And I talked too much in general.
And then the interrogations started.
Exactly. In the spring of 2013, the police searched my office and confiscated my emails. So I asked my friends what I should do. They had told me earlier: we talked to Putin, you have nothing to fear. But this time they told me, "You must leave this country immediately. Otherwise, you may be arrested." So the next day I bought a one-way ticket.
And your family? Your wife was also an economist at the New Economic School.
My wife told me years earlier that we would have to leave the country someday. I replied that I had to take care of the university. So she went to Paris with the kids in 2010. And I commuted between Paris and Moscow every week after that.
You've always been a border crosser between the East and the West, and you've also done research at U.S. universities. How do you feel when the two worlds drift apart like that?
That's a difficult question. As economists, we are very cosmopolitan. At home, we speak Russian with the children. And they speak French among themselves. I can't go back to Russia. Although there was a time when I could, because I worked for the European Development Bank, which gave me diplomatic immunity. This allowed me to travel to Russia three times for a few days. I cannot do that anymore.
Where are your roots?
We recently talked about this very question in the family when we were considering buying a house in the countryside in France. The neighbors there are Polish dissidents who spent time in prison. They told us, "We bought the house to put down roots again." That made a big impression on my wife. She said, "Let's buy the house."
And your children are now rooted there.
My children are Parisians. They think country life is for old people. (laughs)
Let's now fast forward in time: It is February 24, 2022. Russian tanks cross the border into Ukraine, and the "Special Military Operation" begins. Has Vladimir Putin changed in the meantime?
Putin didn't want a long bloody war; he wanted quick success. He wanted to repeat the Crimean invasion of 2014 and give his popularity a boost. He believed he would conquer Ukraine in a few days. But dictators make mistakes because the people around them are yes-men. Everyone else - people like me - has long since been thrown out of the country.
So who does Putin listen to?
Putin listened to his generals, who told him how strong the army was. And his KGB entourage told him that Ukraine would welcome Russian troops with enthusiasm. They also told him that President Zelenskyy would flee. He underestimated his opponents.
What are your assessments based on?
I talk to people in Moscow.
Did Putin get a boost at the start of the war?
An interesting turning point happened after a week. At first, there was still independent media. Social media were also open. But then Putin saw that there were resistance and demonstrations. In the first days of the war, his popularity continued to drop. So there was only one thing left: censorship. The ban on calling the war "war." Independent media were shut down, Facebook and Instagram blocked.
How should we imagine Putin's inner circle?
He talks a lot with KBG people. Nikolai Patrushev is a key adviser. He talks with Foreign Minister Sergei Lavrov. And then he makes decisions.
Does Putin conduct debates? Does he accept opposing opinions?
No. I experienced this up close once. In 2012, Putin spoke at an investment forum, and U.S. economist and Nobel laureate Paul Krugman was also a guest. Putin said to him, "You are very smart, you are a Nobel laureate, but I have many more sources than you. So I know more." In other words, Putin was convinced he knew more about economics than Paul Krugman. That was very, very interesting to see.
One man you didn't mention now is former President Dmitry Medvedev.
He is completely insignificant today.
He is, after all, the deputy head of the important Security Council.
That is a job that was created especially for him. I suspect that he is enormously afraid of the KGB people. You have to understand: Putin has created a system where everyone hates everyone else. So there are no alliances against him. Medvedev is afraid that he could be arrested. So he sends the signal: I support the war more than anyone else.
Why?
Putin hates traitors. Who is dead or in prison today? People who betrayed him. Medvedev wants to avoid being seen as a traitor because he also used to deal with Western politicians, for example, Barack Obama.
How does the Russian population view the war today?
We don't know exactly. The regime is so repressive that almost no one dares to talk. I don't trust the published polls. Leaked polls from the Kremlin appear from time to time, and the approval for the war is much lower. But even there I have doubts. Keep in mind that if we had a conversation like we are having right now in Russia, we would be put in jail for ten years. Publicly opposing the war is dangerous, which makes it difficult to gauge the mood.
The word "war" comes up more often in Russia now.
From the Russian point of view, a lot is going wrong right now. Ukraine is reclaiming land. Mass graves are popping up. Putin is running out of options.
What will he do?
He must somehow be able to tell himself and his inner circle that he has won the war. If, for example, the 2014 borders were restored, he could not declare victory. He needs at least a strip of land in order to win.
You sound pessimistic.
Well, at least I don’t think Putin will risk nuclear war.
Why?
Because he doesn’t want to die. He knows that a nuclear war could mean his death. He spent two years in isolation during the pandemic. He has this long table. He hides in bunkers. He builds himself palaces. The man wants to live.
How is the partial mobilization to be understood? What kind of signs is Mr. Putin sending?
The partial mobilization shows one thing above all: Putin has realized that he is losing the war. However, given the high casualties and the destroyed economy, he needs to show terrain gains. Otherwise, his reputation in Russia will suffer massively. However, he has no modern war material. Therefore, he needs more soldiers. In the past, he simply used money to recruit soldiers from poor regions. But now he has too little cash because of the sanctions. As a result, Putin needs soldiers who cost nothing. However, the people he mobilizes are not motivated and poorly trained and equipped. Therefore, the losses in Putin's army are likely to increase. It is possible that he can use them to stop the Ukrainian counteroffensive, but at a very high price.
And what is the significance of the sham referendums in eastern Ukraine?
He does that to further threaten the West. He will say that Kherson, for example, belongs to Russia and that he will use all means including nuclear weapons to defend Russia. This is a strange rationale. After all, Ukraine has already attacked Crimea, which was annexed by Russia. Putin did not respond.
Can the West offer Putin an option to save face?
It may be that at some point the Ukrainians will not regain land, that the counteroffensive will stall. But they will not stop fighting.
And then?
There could be a demarcation line like in the Korean War. There is still no peace agreement there today. The line then becomes more and more solidified. Battles slowly diminish. The Western sanctions on Russia remain in force. Ukraine begins to rebuild. And Putin fires missiles into Ukraine from time to time to undermine the renewal.
There is a position in the West - including in Switzerland - that the sanctions against Russia do not work, and actually harm our economy. You see it completely differently.
There is a position in the West - including in Switzerland - that the sanctions against Russia do not work, and actually harm our economy. You see it completely differently.
They're talking about the oil embargo, which is supposed to come in December.
And the price cap on Russian oil. That will cut Russia's ability to finance the war. That's why Putin is so nervous, that's why he wants Europe to break up now - and not in the winter.
Do the sanctions also have consequences for the Russian arms industry?
Partly. It has become more difficult to produce tanks, combat aircraft, and precision weapons. As a result, we only see Soviet-era Russian tanks in the war zone. Russia has to buy drones from Iran. And reports are coming out of U.S. intelligence circles that Russia is buying missiles in North Korea. All this is a huge humiliation of the Russian arms industry.
Is China a substitute trading partner for Russia?
The potential is certainly there. But China has refused to supply weapons to Russia, for example. That is very important. And companies like Huawei have announced they will no longer sign contracts with Russia. Why? Because the U.S. is threatening sanctions. Chinese banks also don't want to do Russian business. Yes, China is buying more oil from Russia, but this is where the price cap comes in: China will pay a low price. And if it doesn't, the U.S. will likely impose sanctions on China as well.
You told us that Vladimir Putin hates traitors. Are you afraid that one day he will treat you like one?
I am not a traitor to Putin, just an enemy. That's why I emphasized at the beginning of our conversation that I never worked for Medvedev or Putin. Nor did I ever pretend to approve of their positions.
A traitor is worse than an enemy?
Precisely. But keep in mind that even someone like Alexei Nawalny never worked for Putin. Nevertheless, he was poisoned. Being an enemy offers no protection. Traitors are simply priority targets.
Are you in contact with Navalny?
He is a good friend - and much braver than I am. Until a few weeks ago, it was possible to write to him in prison. He will not be released as long as Putin is in the Kremlin. And if then someone comes to power who thinks Putin was too soft - then it will be dangerous, for the West, for Ukraine, and also for Navalny. But if a civilian who wants to get rid of the sanctions becomes president, there will be a softening of the fronts. And that includes releasing political prisoners.
You speak very openly. Are you not afraid of consequences?
I am not the first on the list. Moreover, I am not under personal protection. But you'd better not drink from my water... (laughs) Seriously, as a father, I worry about the issue. We ask ourselves, for example: Who would get the house, our assets? We are very happy that our children are at a good university today.
We suspect that on the one hand you are personally relieved to have left Russia early. On the other hand, it must make you angry that the situation could get so much worse - and no one was able to do anything about it.
There are Russians who say in the direction of the West, "Look, we warned you!" But I don't think that way. It would have been our task to make Russia a democratic country. And we failed. I and others could and should have done more. That is our responsibility. And that hits me very hard.
What gives you hope?
The day will come when Russia will be a free country. Russia is so close to Europe. And I am younger than Putin. I will live to see that day.
Sergei Guriev knows the Putin system intimately. Because he was too liberal for Moscow, he had to flee. Now he tells us who Putin still listens to, what the Kremlin leader is doing in the crisis - and how serious the nuclear threat is.
This interview by Mario Stäuble was originally published in German by Swiss daily «Tagesanzeiger», 28 September 2022. Translated and edited for layout purposes by the UBS Center.
Mr. Guriew, with your permission, we would like to turn back the time, to your old life.?
Sergei Guriev is Professor and Sciences Po Provost, Senior Fellow IUF, CEPR Director of the Populism RPN and Research Fellow
When Sergei Guriev departed Moscow for France in 2013, the news made the world press. His flight was a signal that Russia was moving toward repression – a liberal Russian economist who wanted to build a modern business university in Moscow was leaving the country for security reasons. Today, the 50-year-old Guriev serves as vice rector and professor at the Paris Institut d'Études Politiques, also known as Sciences Po. His current book, Spin Dictators, revolves around the question of how dictators of the 20th and 21st centuries differ. Guriev lives near Paris with his partner, economist Ekaterina Zhuravskaya, and his children. The interview took place at an event hosted by the UBS Center for Economics in Society at the University of Zurich. (ms)
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Sergei Guriev is Professor of Economics and (since 2022) Provost at Sciences Po, Paris, which he joined in 2013 after serving as Rector of the New Economic School in Moscow from 2004 to 2014. He is also a former Director of Graduate Programs in Economics at Sciences Po. Guriev was on leave from Sciences Po serving as the Chief Economist and the Member of the Executive Committee of the European Bank for Reconstruction and Development (EBRD) from 2016 to 2019. Professor Guriev’s research interests include political economics, labor mobility, corporate governance, and contract theory. He has published extensively in leading international journals. He has been a board member of several Russian banks and companies as well as a member of various international scientific councils and committees. Since 2011, he has been a member of the World Economic Forum’s multiple Global Agenda Councils and Global Future Councils. He is also a Research Fellow and the Leader of the Research and Policy Network on Populism at the Centre for Economic Policy Research, London.
Sergei Guriev is Professor of Economics and (since 2022) Provost at Sciences Po, Paris, which he joined in 2013 after serving as Rector of the New Economic School in Moscow from 2004 to 2014. He is also a former Director of Graduate Programs in Economics at Sciences Po. Guriev was on leave from Sciences Po serving as the Chief Economist and the Member of the Executive Committee of the European Bank for Reconstruction and Development (EBRD) from 2016 to 2019. Professor Guriev’s research interests include political economics, labor mobility, corporate governance, and contract theory. He has published extensively in leading international journals. He has been a board member of several Russian banks and companies as well as a member of various international scientific councils and committees. Since 2011, he has been a member of the World Economic Forum’s multiple Global Agenda Councils and Global Future Councils. He is also a Research Fellow and the Leader of the Research and Policy Network on Populism at the Centre for Economic Policy Research, London.