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| The Fight With the West Is Isolating Russia. But That Isn’t Stopping Putin. | The Fight With the West Is Isolating Russia. But That Isn’t Stopping Putin. |
| (about 9 hours later) | |
| MOSCOW — At least one bright spot stands out in the Russian economy, even as its prospects darken in the face of escalating sanctions: the manufacture of work uniforms. | MOSCOW — At least one bright spot stands out in the Russian economy, even as its prospects darken in the face of escalating sanctions: the manufacture of work uniforms. |
| The production of specialized work clothes, including bulletproof vests, is one of the lone growth areas in the economy, up by 27 percent, said Igor Nikolaev, director of the Strategic Analysis Institute at the FBK auditing and consulting firm. The comments came at an otherwise gloomy news conference Tuesday focused on Russia’s economic prospects. | The production of specialized work clothes, including bulletproof vests, is one of the lone growth areas in the economy, up by 27 percent, said Igor Nikolaev, director of the Strategic Analysis Institute at the FBK auditing and consulting firm. The comments came at an otherwise gloomy news conference Tuesday focused on Russia’s economic prospects. |
| That statistic, amid a generally dormant economy kept afloat as usual by energy sales, seemed to underscore what many analysts are saying at the moment: President Vladimir V. Putin’s increasingly aggressive posture toward the West is producing a boomerang effect, with an isolated Russia likely to suffer long-term economic damage as a result. | That statistic, amid a generally dormant economy kept afloat as usual by energy sales, seemed to underscore what many analysts are saying at the moment: President Vladimir V. Putin’s increasingly aggressive posture toward the West is producing a boomerang effect, with an isolated Russia likely to suffer long-term economic damage as a result. |
| The deterioration reflects a growing awareness in Western capitals that Russia, growing ever more hostile, should be treated as a threat rather than a mere annoyance. That in turn is pushing them toward a unified front in challenging Moscow over such serial transgressions as destabilizing its neighbors, assassinating its critics abroad, meddling in the elections of other countries, tolerating the use of chemical weapons by the Syrian government and cyberskirmishing. | The deterioration reflects a growing awareness in Western capitals that Russia, growing ever more hostile, should be treated as a threat rather than a mere annoyance. That in turn is pushing them toward a unified front in challenging Moscow over such serial transgressions as destabilizing its neighbors, assassinating its critics abroad, meddling in the elections of other countries, tolerating the use of chemical weapons by the Syrian government and cyberskirmishing. |
| The confrontation is likely to only get worse, analysts say, for one main reason: Mr. Putin and his closest advisers are convinced they are justified in their policies and have persuaded important portions of the elite as well as the bulk of Russians that the country is thriving, rebuilding its global muscle rather than weakening itself. | The confrontation is likely to only get worse, analysts say, for one main reason: Mr. Putin and his closest advisers are convinced they are justified in their policies and have persuaded important portions of the elite as well as the bulk of Russians that the country is thriving, rebuilding its global muscle rather than weakening itself. |
| “The party of war has won within the Russian elite,” said Yuliy A. Nisnevich, a political-science professor. “There are people in the elites who would like the confrontation to stop — these are the people who would like to spend or earn money abroad. But the party of war, the people who get their money inside the country and live here, is prevalent now.” | “The party of war has won within the Russian elite,” said Yuliy A. Nisnevich, a political-science professor. “There are people in the elites who would like the confrontation to stop — these are the people who would like to spend or earn money abroad. But the party of war, the people who get their money inside the country and live here, is prevalent now.” |
| Russia, of course, professes its innocence on all fronts. It accuses the West of suffering from an advanced case of Russophobia, a longstanding disease that emerges from hibernation whenever Russia begins to “get up off its knees.” | Russia, of course, professes its innocence on all fronts. It accuses the West of suffering from an advanced case of Russophobia, a longstanding disease that emerges from hibernation whenever Russia begins to “get up off its knees.” |
| Sergei V. Lavrov, Russia’s foreign minister, said in a television interview broadcast Tuesday that the last vestiges of trust with the West were evaporating, sinking below even Cold War levels. “There were communication channels during the Cold War, and there was no obsession with Russophobia, which looks like genocide through sanctions,” Mr. Lavrov told the BBC. | Sergei V. Lavrov, Russia’s foreign minister, said in a television interview broadcast Tuesday that the last vestiges of trust with the West were evaporating, sinking below even Cold War levels. “There were communication channels during the Cold War, and there was no obsession with Russophobia, which looks like genocide through sanctions,” Mr. Lavrov told the BBC. |
| From the Western countries’ perspective, however, the mood is one of enough is enough, and they are gradually acting in concert in delivering that message to the Kremlin. Economic sanctions imposed after the 2014 annexation of Crimea, which represented the start of deteriorating relations, have remained intact despite repeated predictions from the Kremlin that one European Union member or another would eventually veto them. | From the Western countries’ perspective, however, the mood is one of enough is enough, and they are gradually acting in concert in delivering that message to the Kremlin. Economic sanctions imposed after the 2014 annexation of Crimea, which represented the start of deteriorating relations, have remained intact despite repeated predictions from the Kremlin that one European Union member or another would eventually veto them. |
| More recently, there was the mass expulsion of some 150 Russian diplomats from Western nations after the chemical poisoning of a former Russian spy in Britain in March; harsh United States sanctions against several Russian oligarchs, political figures and companies; and the bombing of Syria by the United States, France and Britain over the weekend. | More recently, there was the mass expulsion of some 150 Russian diplomats from Western nations after the chemical poisoning of a former Russian spy in Britain in March; harsh United States sanctions against several Russian oligarchs, political figures and companies; and the bombing of Syria by the United States, France and Britain over the weekend. |
| “There is an upsurge in momentum of the kind we have not seen before,” said James Nixey, the head of the Russian program at the London-based think tank Chatham House. He is not sure it will last, however, with nations like Hungary following the Putin model, while the Baltics and the Scandinavian countries remain far more wary. | “There is an upsurge in momentum of the kind we have not seen before,” said James Nixey, the head of the Russian program at the London-based think tank Chatham House. He is not sure it will last, however, with nations like Hungary following the Putin model, while the Baltics and the Scandinavian countries remain far more wary. |
| In Russia, the population can basically be broken down into three groups, said Vladislav L. Inozemtsev, a Russian scholar currently at the Polish Institute of Advanced Studies in Warsaw. | |
| The circle around Putin and the bulk of the population are sure that Russia is doing everything right, while the urban elite, including a majority of the business community, thinks it has gone too far and needs to find a way to reset relations with the West, he said. | The circle around Putin and the bulk of the population are sure that Russia is doing everything right, while the urban elite, including a majority of the business community, thinks it has gone too far and needs to find a way to reset relations with the West, he said. |
| The latter group views growing Western consolidation with trepidation, he said, while the Putin court and the majority “believe that quite soon the Western unity will vanish.” | The latter group views growing Western consolidation with trepidation, he said, while the Putin court and the majority “believe that quite soon the Western unity will vanish.” |
| They have a wild card in President Trump. He has long been reluctant to criticize Russia, but his attitude has proved more volatile of late. On Sunday, Nikki R. Haley, the American ambassador to the United Nations, said that Washington was about to impose yet more sanctions on Russia, but Mr. Trump rejected the idea on Monday. | They have a wild card in President Trump. He has long been reluctant to criticize Russia, but his attitude has proved more volatile of late. On Sunday, Nikki R. Haley, the American ambassador to the United Nations, said that Washington was about to impose yet more sanctions on Russia, but Mr. Trump rejected the idea on Monday. |
| There are those who believe that the Russians have some hold over Mr. Trump. That explanation does not have much public currency in Russia, where the attitude swings between humor and exasperation. | There are those who believe that the Russians have some hold over Mr. Trump. That explanation does not have much public currency in Russia, where the attitude swings between humor and exasperation. |
| If the value of the ruble in relation to the dollar used to fluctuate according to the price of oil, it is now Trump tweets about Russia that send it swinging, goes one joke. | If the value of the ruble in relation to the dollar used to fluctuate according to the price of oil, it is now Trump tweets about Russia that send it swinging, goes one joke. |
| But economists are not laughing about the sanctions imposed by the United States last week. The hardest hit was Rusal, one of the world’s largest manufacturers of aluminum, which appeared on the sanctions list and saw its value plummet. Japan just became the latest country to announce that it would halt purchases from the company. | But economists are not laughing about the sanctions imposed by the United States last week. The hardest hit was Rusal, one of the world’s largest manufacturers of aluminum, which appeared on the sanctions list and saw its value plummet. Japan just became the latest country to announce that it would halt purchases from the company. |
| The Russian Parliament expedited a draft of proposed countersanctions last week that ranged from halting the import of medicine from the United States, to cutting off titanium and uranium sales, to allowing the open theft of American intellectual property. A statement by one legislator, Pyotr O. Tolstoy — a descendant of the writer — that Russians would happily drink brewed tree bark instead of using American medicine provoked widespread derision. | The Russian Parliament expedited a draft of proposed countersanctions last week that ranged from halting the import of medicine from the United States, to cutting off titanium and uranium sales, to allowing the open theft of American intellectual property. A statement by one legislator, Pyotr O. Tolstoy — a descendant of the writer — that Russians would happily drink brewed tree bark instead of using American medicine provoked widespread derision. |
| On social media, the idea of imposing countersanctions has become known as “bombing Voronezh,” a provincial Russian city, the idea being that such measures invariably hurt Russians. | On social media, the idea of imposing countersanctions has become known as “bombing Voronezh,” a provincial Russian city, the idea being that such measures invariably hurt Russians. |
| “We all see that the sanctions standoff is strengthening,” said Mr. Nikolaev, the economist, and the Russian response “might in fact harm us.” | “We all see that the sanctions standoff is strengthening,” said Mr. Nikolaev, the economist, and the Russian response “might in fact harm us.” |
| Boeing, for example, buys about 35 percent of its titanium, which is used extensively in the 787 Dreamliner, from VSMPO-Avisma, the state monopoly that controls titanium production. The company warned in a statement that such a measure could adversely affect 20,000 employees and the economy as a whole. | Boeing, for example, buys about 35 percent of its titanium, which is used extensively in the 787 Dreamliner, from VSMPO-Avisma, the state monopoly that controls titanium production. The company warned in a statement that such a measure could adversely affect 20,000 employees and the economy as a whole. |
| The outcry from businesses over the potential countersanctions was such that Russian Parliament postponed discussion of the measures until May 15 to allow for consultations. | The outcry from businesses over the potential countersanctions was such that Russian Parliament postponed discussion of the measures until May 15 to allow for consultations. |
| Ultimately, the path is clear, with the upshot of actions from both the West and Russia driving the “deglobalization” of Russia, said Evsey Gurvich, the head of the Expert Economic Group, an independent analytic center. As the West shuns Russia, the country will withdraw more and more to try to protect itself from further sanctions, he said. | Ultimately, the path is clear, with the upshot of actions from both the West and Russia driving the “deglobalization” of Russia, said Evsey Gurvich, the head of the Expert Economic Group, an independent analytic center. As the West shuns Russia, the country will withdraw more and more to try to protect itself from further sanctions, he said. |
| This year economic growth will be lower than the 2 percent anticipated, with expert predictions ranging from 1.7 percent to none. | This year economic growth will be lower than the 2 percent anticipated, with expert predictions ranging from 1.7 percent to none. |
| The result, some experts noted, is the state’s taking control over more of the economy as it tries to protect jobs and industries from the fallout from sanctions, driving Russia back toward the Soviet model. In addition, when a big company like Rusal gets hit with sanctions and its revenues plunge, there is less tax revenue for the budget so social services like medicine and education suffer cuts. | The result, some experts noted, is the state’s taking control over more of the economy as it tries to protect jobs and industries from the fallout from sanctions, driving Russia back toward the Soviet model. In addition, when a big company like Rusal gets hit with sanctions and its revenues plunge, there is less tax revenue for the budget so social services like medicine and education suffer cuts. |
| It is unclear that there will be domestic political problems for Mr. Putin, however. Real incomes have been falling over the last few years, but he still received overwhelming support in the March presidential election. | It is unclear that there will be domestic political problems for Mr. Putin, however. Real incomes have been falling over the last few years, but he still received overwhelming support in the March presidential election. |
| No one expects economic issues to change Mr. Putin’s mind about confronting the West either. The upshot is that the Kremlin elite who are winning the internal struggle value geopolitical goals far more than the country’s economic development, experts said. | No one expects economic issues to change Mr. Putin’s mind about confronting the West either. The upshot is that the Kremlin elite who are winning the internal struggle value geopolitical goals far more than the country’s economic development, experts said. |
| “When we say that we are not successful and quote economic numbers, they say that they do not care about this,” said Leonid Gozman, a political commentator and former politician. | “When we say that we are not successful and quote economic numbers, they say that they do not care about this,” said Leonid Gozman, a political commentator and former politician. |