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Jennifer Rubin

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My latest for US-Russia.org Expert Discussion Panel on whether to view the recent Georgian elections, in which Saakashvili’s United National Movement lost a lot of power, as a Kremlin coup or a triumph of democracy. My view that it isn’t really either:

Two dominant themes prevailed in media coverage of the 2012 Georgian elections

(1) The people were hoodwinked, as Georgian Dream are a corrupt band of Russian stooges – as argued by neocon Jennifer Rubin and Yulia “Pinochet” Latynina (see juicy quote from her translated below):

It is possible that Georgia will get one more chance. In that one short moment, when a confused people will look on with astonishment as the band of thieves returning to power brings back its lawlessness – but at a point of time when the army and police are not yet wholly purged of respectable people, who care for the fate of their country – in that moment, Georgia will get another window of opportunity. Like the one, for instance, that Pinochet got on September 11, 1973. But maybe, this chance will never come.

(2) The elections were a genuine victory for Georgian democracy, with Saakashvili’s very defeat vindicating his historical status as a democrat and reformer. Two headlines from democratic journalist Konstantin von Eggert summarize this viewpoint: “Georgians are no longer a mass, but a people“; “Saakashvili accomplished the authoritarian modernization that Russian liberals only dreamed of.”

The Kremlin is in confusion: A state, which they practically denounced as a fascist dictatorship just three years ago, has become a democracy… And the oft-ridiculed and cursed Georgian President, known for his chewing of ties, became practically the most successful reformer in the post-Soviet space, barring the Baltics.

I think both viewpoints are substantially wrong, but to see why we have to consider this history in more detail.

In his first elections in 2004, Saakashvili won 96% of the votes. It was fairer than it looks, but only because of a complete absence of credible candidates at the time. In his second election, in 2008, not only did turnout correlate positively with the Saakashvili vote, but its graph had what is called a “long tail”, becoming suspicious after the 80% mark and registering quite a few stations with 100% turnout. This is remarkably similar to the pattern of falsifications in Russian elections under Putin (though needless to say, Georgia doesn’t attract a fraction of the same attention).

In these elections, multiple factors came together to produce radically different outcomes. The opposition came together, held together by Ivanishvili’s money – who also claims to have spent $1.7 billion, or more than 10% of Georgia’s GDP, over the past several years on stuff like paying officials’ salaries and buying new police cars. That’s like Prokhorov spending $150 billion in Russia, or Romney $1.5 trillion on the US election – while money is far from everything in politics, sums as huge as these certainly help.

Then there were the conveniently timed prison torture videos, broadcast by two suddenly opposition TV channels. These were Maestro, which in 2012 had been investigated for giving out free antennas, allegedly as part of vote-buying by Ivanishvili; and TV-9, a recent creation of Ivanishvili himself. Until recently, these channels appear to have been fairly minor; the big two were Rustavi 2, which is firmly pro-government, and Imedi. Though it was once the traditional opposition channel, Imedi – ever since its owner Badri Patarkatsishvili fell out with Saakashvili – had been tamed by police raids in 2007, to the extent that it orchestrated coverage of a hoax Russian invasion of Georgia to bolster support for Saakashvili.

All these factors – the background of Ivanishvili’s populist spending and opposition consolidation, plus his purchase of a TV presence and the very good timing of the videos – contributed to a drastic, sudden, and unforeseeable reversal in the United National Movement’s until recently far superior poll ratings (see below).

Furthermore, this election was far cleaner than previous ones (which of course favored the opposition): This time there were only a couple of stations with close-to-100% turnout, and in any case, greater turnout now coincided with more votes for Georgian Dream, not Saakashvili or his party (as was the case in 2007 and 2008). I suspect this is because, cognizant of the shift against Saakashvili, the “administrative resource” that had previously served him and the UNM became demoralized and fearful of prosecution in a future administration headed by Ivanishvili; as such, it now refused to give him his customary +3%-5% addon.

These developments were unexpected. It was Saakashvili’s very confidence in a United National Movement victory that presumably motivated him to shift formal powers from the Presidency to the Prime Minister, with a view to taking the latter position (or inserting an ally there) once his two terms were up. Until recently numerous commentators were speaking of Saakashvili “pulling a Putin” (rarely adding that Putin didn’t change the Constitution to empower the PM). Ironically, it was this very drive for greater political consolidation that ended up hoisting Saakashvili by his own petard. From 2013, it is Ivanishvili and allies who will get all the real power, regardless of who wins the Presidency.

In this context the dominant theories can be dismissed or modified. The theory that these elections were a “Russian coup” or somesuch is laughable on its face; only Saakashvili and his supporters seriously believe it, or pretend to. But the theory it’s a democratic triumph is also problematic given the critical role played by Ivanishvili’s money, not to mention Saakashvili’s own indifference to the concept (in practice, nor rhetoric). I submit that what we saw is an “oligarchic coup”, of the type not uncommon in poor countries with weak institutions and big personalities (and perhaps, of the type that Khodorkovsky may have accomplished in 2003 in a parallel world).

As such, given the contingent and artificial events that spawned this new revolution, Georgia can hardly be said to have become a model of democracy.

It is too early to tell what relations with Russia will be like after 2013. Doubtless better than under Saakashvili, but that’s not really saying anything considering how horrid they are now. I would caution that just because the Kremlin obviously prefers Ivanishvili certainly doesn’t mean he will be its puppet once in power (one factoid airbrushed out of history by everyone is that Russia also supported Saakashvili over Shevardnadze in the Rose Revolution). He is strongly committed to NATO membership, which – if pursued with the same old vigor – will continue to cause irreconcilable problems. With 62% of Georgians favoring NATO accession, and only 10% against, it’s not like Ivanishvili will be in much of a position to halt this process even if he were so inclined.

One can only hope that under Georgian Dream these disagreements, which are unlikely to go away any time soon, will be discussed in rather more civilized ways than was the case on August 8, 2008.

PS. Also feel free to read Sergey Roy‘s rejoinder to my piece.

I must congratulate Mr. Karlin on his excellent analysis of the politics involved in the recent parliamentary election in Georgia, its causes and consequences. A few comments are due, though.

Politics and politicking, as described in Anatoly’s essay, are surely important, but it is also advisable to take the Marxian – or merely commonsensical view of changes in a society’s superstructure as mostly reflections of processes in its economic basis. Ignoring the latter is only excusable in someone like Ms. Latynina (quoted in Karlin’s piece): she writes novels, you know, and clearly has trouble distinguishing between fiction and reality. She may believe, for instance, that under Saakashvili Georgia was going through a period of unprecedented efflorescence, but that’s sheer fiction. Mere propaganda, actually. The facts on the ground are different, very much so.

In a nutshell, Georgia is a basket case, in economic terms. According to an oppositionist source, its national debt is four times the size of its annual GDP (not that the latter is anything to write home about). According to the same source, unemployment there runs at an unheard-of 70 percent which was only brought down to the official figure of 20 percent by including everyone who has a few vines growing on the plot of land their house stands on in the “gainfully self-employed” category. That’s the sort of cheating that simply does not fool anyone.

There is also the foreign trade factor. Russia used to absorb all the alcohol Georgia produced rather scandalously, I must say: before Saakashvili, Russia imported three times more wine than Georgian vineyards could physically yield. A friend of mine spent a couple of days in and out of the bathroom after drinking a bottle of unbelievably cheap Khvanchkara. Luckily I had savvy enough to spit out the first mouthful. No wonder a member of Saakashvili’s government notoriously said that those Russian swine can drink anything. Now they drink nothing nothing of Georgian origin, that is and Georgian wine and brandy producers know exactly who they can thank for it. No wonder they wish him out of the way of normal economic intercourse.

Also on the economy side, there are between 800,000 and one million Georgians (no one seems to know how many exactly) feeding their own faces in Russia and the mouths of their relations back home. Russo-Georgian relations being what they are, those wretched people have to travel to and from Georgia via Ukraine or Armenia. Again, they and their relations — know exactly at whose feet they can lay this inconvenience.

Still staying with the economy, only creative writers like Latynina can believe their own fiction that Saakashvili’s regime is squeaky clean, that under his rule corruption, endemic in Georgia just as in other lands one might point a finger at, was stamped out completely. Sure, US money contributed a lot toward computerization, and you can register a company in half an hour or so in Georgia. What will happen to your company afterwards is quite a different matter. All of Georgia’s economic life, what there is of it, is in the hands of regime-related clans, and outsiders are unwelcome to such a degree that they see their future as hopeless. Naturally they want a piece of the action which is impossible unless the present regime is changed. Well, so it has been, or is being not without a great deal of interclan fighting, one can safely predict.

I am sure I have not covered all the economic factors that explain the Georgians’ desire to get rid of Saakashvili and much of what his regime stands for. Still, I am just as convinced that even these few factors carried more weight with voters than TV pictures of torture in Georgia’s prisons, Ivanishvili’s propaganda, and other political and circumpolitical events described in detail in Anatoly Karlin’s piece. Above all, the mood of general dissatisfaction with and anger at the populace’s economic condition had to be there. It was, and it was the prime factor in the events we have just witnessed and are going to witness.

As for politics, Georgians are no different from many other peoples: they want to eat their mamalyga and have it. They want to have Sukhum and Tskhinval back they lorded it over there for too long to reconcile themselves to the loss. So they want Russia to go away from these regions and yet have normal trade and other relations with it. What can Russia’s course be, in this situation? Withdrawing from Abkhazia and S.Ossetia is out of the question, for that would mean NATO bases practically on Russia’s southern flank. Therefore a bit of cognitive and emotional dissonance is inevitable for any future Georgian regime: it, and most Georgians, can dream of NATO and EU membership, heartily dislike Russia and at the same time keep selling it wine, their principal commodity under strict quality control, that is. No more slops with Khvanchkara labels, please.

(Republished from Da Russophile by permission of author or representative)
 
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Despite the unremitting hostility of its Russian neighbor, which crescendoed in a military occupation of a chunk of its territories, plucky Georgia’s commitment to reform and democratic values will ensure its rapid development into a “booming Western-style economy.” Under its charismatic Western-trained President, Saakashvili, it has rooted out corruption, ushered in untold prosperity and freedoms, and left dictatorial Russia in the dust. ““There are barbarians there and civilization here,” summarizes Saakashvili himself, “There they have mongoloid brutality and ideology while here we have the true, the oldest Colchis Europe, the most ancient civilization.”

At least, that’s the picture you might have of Georgia if you read Saakashvili’s speeches, Western op-eds, Russian liberals like Cato Institute flunky and global warming denier Andrey Illarionov, and a sundry host of Georgian ambassadors and lobbyists shilling for all they’re worth in major Western newspapers. But rhetoric and reality can be two very different things. To what extent do objective indicators (e.g. statistics) bear out this neocon vision of Tbilisi as the shining city on the Caucasian hills?

By the numbers… Let’s start with the economy. Saakashvili deserves some credit for maintaining respectable GDP growth rates, albeit they are far from the awe-inspiring figures of China or, for that matter, several other post-Soviet republics. From 2004 to 2011, the Georgian economy grew at an average of 6.0% per annum, which is only modestly higher than Russia’s 4.5%.

However, this comparison becomes much more unfavorable once Georgian growth is adjusted for other factors. First, Russia is already much richer than Georgia – its GDP, however you measure it, is more than three times higher – so by basic economic theory, ceteris paribus its growth rate should be much higher as poorer countries have many more easy opportunities to increase productivity. (Illarionov, by the way, is ignorant of convergence theory, a fairly basic macroeconomic concept; it’s frightening that this “economist”, who is more accurately a libertarian ideologue, was once a major economic adviser to the Russian government). Second, Georgia had by far the biggest and sharpest decline in GDP during the early 1990′s of all the Soviet republics, and even as of this year, its gross output is still 20% below the peak levels of 1989. This should also, in principle, help Georgia grow much faster than Russia – which surpassed its peak Soviet-era output sometime in the mid-2000′s – because in a sense it is still “recovering” from an economic depression.

A much more appropriate comparison would be with Armenia. Both are in the unstable Caucasus region. Georgia has intermittently faced sanctions from Russia, whereas Armenia is under permanent economic blockade from Turkey and Azerbaijan. Unlike Azerbaijan, neither Tbilisi nor Yerevan enjoy an oil windfall. Their GDP per capita is almost exactly the same: About $3000 nominal, and $5000 in purchasing power adjusted dollars. Unlike Georgia, Armenia has recovered its Soviet-era production levels and then some; its GDP is now more than 50% as big as in 1989, so it is well past the period of mere “recovery growth”. Both countries suffered from destructive wars in the early 1990′s, and both remain highly militarized to this day. Nonetheless, with the exception of the past three years, when it was crushed by the economic crisis, Armenia has consistently clocked up higher GDP growth rates than Georgia. In sum terms, during the 2004-2011 period, both countries grew at approximately the same pace: 6.0% for Georgia, 6.3% for Armenia.

In the graph above, GDP per capita is indexed to 100 at 2003 for a range of post-Soviet countries. It is clear that Estonia and Armenia, despite their deep recent recessions, are highly successful transition economies; both are a lot more prosperous now than in 1989. Russia is only moderately successful. Along with Ukraine, Georgia is still well below Soviet-era peak output levels, and its growth under Saakashvili wasn’t exceptional by the standards of other post-Soviet republics, despite its twin advantages of starting from a low base (unlike Russia, Estonia) and still being in the process of recovering lost output (unlike Armenia).

Another relevant comparison is with the “corrupt” and “nepotistic” Shevardnadze administration from 1995-2003, which was overthrown to great fanfare in the “Rose Revolution”. What was Georgia’s growth rate then? 5.9%. That is within rounding error of growth under Saakashvili. It should furthermore be noted that growth was accelerating throughout Shevardnadze’s Presidency, reaching a peak of 11.1% in 2003. So there are valid questions as to the extent the high growth rates of the early Saakashvili Presidency were due to his neoliberal reforms.

What about life for ordinary people? There is no doubt that the average Georgian became significantly better off, as was the case everywhere in the former USSR during this period. Georgian statistics show nominal wages almost quadrupling from 2004-2010, from 157 lari to 598 lari per month, albeit adjusting for inflation would reduce it to only a bit better than a doubling.

However, higher wages can only be enjoyed by people who actually get them. During the same period, unemployment grew from 12.6% to 16.3%. Despite neoliberal reforms that undercut the bargaining power of labor, unemployment in Georgian urban areas – approaching 40% in the capital, Tbilisi – is now as prevalent as in the most impoverished provinces of the Russian Caucasus. About half of the Georgian labor force is “self-employed” in sustenance farming, which is a higher figure than two decades ago. In contrast, unemployment in both neighboring Armenia, and “corrupt” and “stagnating” Russia is around 6%-7%.

So bearing in mind actual statistics, does Georgia still deserve the status of a “miracle economy” conferred to it by libertarians and neocons? Don’t get me wrong, 6% is not bad. It’s no worse than under (maligned) Shevardnadze, and modestly better than the 4% average growth rates observed in Moldova, the very worst performer in the entire post-Soviet space. But even so, Georgia is not going to catch up with the developed world at its current pace of development – not like China, which has comparable income levels but is growing at 10% rates, or Russia, which is already three to four times richer.

Moving on, Georgia has also been lauded for excoriating previously endemic corruption, and becoming one of the world’s most “economically free” and business-friendly locations. The latter may well be true; objective ratings such as the World Bank’s Ease of Doing Business, which measure the number of days and permission slips required to start a business, place Georgia 16th globally. This seems a genuine achievement, albeit as real world data shows, these things have at best only a marginal influence on economic growth rates, which are primarily determined by a country’s initial development level relative to the quality of its educational human capital.

On the Corruption Perceptions Index, Georgia improved its score from 1.8 in 2003 to 4.1 by 2011, which is a very significant change (in contrast, Russia languishes at 2.4, and Armenia at 2.6). But some Georgian businesses report government agents demanding political “donations” to Saakashvili’s ruling party to avert hostile raids, and in any case it must be borne in mind that the CPI is a proxy of corruption perceptions, not corruption realities per se. The CPI rating can thus be unduly influenced by good PR and lobbying. As a Western-trained lawyer, Saakashvili appreciates their importance, and has over the years paid millions of dollars to PR firms like Aspect Consulting, Orion Strategies, Public Strategies, and the Glover Park Group to burnish Georgia’s reformist, anti-corruption and democratic image abroad.

Other indicators that are not as reliant on the perceptions of anonymous experts show a somewhat different picture. In the Global Integrity Report, which is based on blind review, Georgia does only modestly better than Russia, scoring 76/100 as compared to Moscow’s 71/100. On the Open Budget Index, which assesses the transparency of government accounts, Russia actually does better, scoring 60/100 to Georgia’s 55/100. And according to Transparency International, the same outfit behind the CPI, the percentage of Georgians who reported paying a bribe in the past year in 2004 was only 6%; as of 2010, this had declined to 3%. A positive and appreciable change to be sure, but the data indicates that petty corruption was not that much of a problem in Georgia to start off with.

Didn’t Saakashvili at least democratize Georgia? Well, no. The fact of the matter is that Georgia was already a democracy under Shevardnadze, if a highly imperfect and illiberal one. The same remains true today. Unofficial protests are brutally broken up, independent TV stations have their licenses revoked, and opposition figures have their citizenships canceled or forced into exile abroad. Georgia has also become a revisionist and highly nationalist power under the charismatic President, whose actions have ranged from the petty and incompetent, e.g. blowing up a Soviet war memorial to Georgian war dead, and in the process killing a mother and her daughter in the blast, to the criminally deranged and incompetent, e.g. the invasion of South Ossetia and carpet bombing of Tskhinvali, even though virtually no Ossetian wants to live in a Greater Georgia.

If one doubts that Saakashvili is in fact rather far from being a nice liberal democrat, all one has to do is look at the indicators of political freedoms. In the Polity IV rankings, the most comprehensive democracy indicators database assembled by political scientists, Georgia increased from 5/10 to 6/10 on a scale from -10 (zero democracy) to 10 (full democracy) under Saakashvili. This is hardly the glorious transformation the Rose Revolution is often made out to be; nor is it very much different from the Evil Empire’s. Russia’s current score is 4/10, for whatever reason down from 6/10 after Medvedev’s election in 2008.

There are however two socio-economic indicators under Saakashvili that did register highly visible, concrete changes. If not for the better.

From 36% in 1991, the tertiary enrollment rate remained steady until the late 1990′s, when it began to grow, reaching 43% by 2003 and peaking at 47% in 2005. Then it plummeted to 25% by 2009, edging up to 28% in 2010. This seems to have been in substantial part due to an increase in the cost of annual university tuition from 500-600 lari in 2003 to 3000-4000 lari by 2009, an eight-fold increase far exceeding the quadrupling of salaries during the same period (even disregarding increased unemployment). Bearing in mind that the average salary was 557 lari in 2009, it is clear that for many families university education became unaffordable. Government grants have also plummeted: From wholly financing the educations of 9,700 students in 2003, by 2009 they were subsidizing only half the tuition costs of 1,000 students. University access has dropped by more than 80% in some regions.

This is particularly catastrophic for Georgia because international student assessments indicate that their schools are almost useless at imparting real world skills. According to PISA 2009, only “31% of [Georgian] students are proficient in mathematics at least to the baseline level at which they begin to demonstrate the kind of skills that enable them to use mathematics in ways that are considered fundamental for their future development.” The equivalent figure for Russia was 72%, and about 78% for the OECD as a whole. On Reading, Math, and Science, Georgian students came, respectively, 67th, 66th, and 70th out of the 75 countries in the PISA assessment. Other international student assessments paint a similarly dire picture. For instance, in TIMMS 2007, Georgian students got an average score of 410 in the Math component, relative to Armenia’s 499 and Russia’s 512. The gap is not substantially different in the Science component, or in the PIRLS 2006 literacy survey. This is unlikely to improve any time soon, as under Saakashvili, the number of public libraries more than halved.

While Georgia was disinvesting in its future workforce, tertiary enrollment has risen in Georgia’s neighbors. In Armenia, it rose from 24% in 1998 to 52% by 2010; the percentage of Russians undergoing university education rose from 55% in 2000 to 76% by 2009. That is because the leaderships of these countries, as in much of the rest of the civilized world, appreciate the importance of human capital to fostering economic growth. In Saakashvili’s world, presumably, praying to the souls of Hayek, Mises and Rothbard would suffice. More education is the road to serfdom.

But in the end, I guess it’s all a matter of priorities. The Georgian army and police are now well fed. Who needs math, science, and literacy anyway? “Military-patriotic education means training in civil defense,” Saakashvili says, “Stimulating soldierly spirit, which historically was always in nature of people in Georgia; as well as courses in Georgia’s military history” is what is really important. Hear hear? Meanwhile, the prison population has tripled from 182/100,000 in 2004, to 536/100,000 in 2011. Under Saakashvili’s democratic guidance, Georgia has acquired the dubious distinction of being the European country with the most prisoners per capita, displacing Russia (the irony!) in the process.

This is not to say that Georgia is a corrupt, stagnant tinpot dictatorship, its tottering foundations stabilized by huge inflows of American capital (though the latter sums, ranging in the billions, are very substantial relative to the tiny size of the Georgian economy). Saakashvili has maintained a mediocre level of economic growth, wages have risen substantially, and corruption has been reduced. Nonetheless, its performance is far less impressive than that of a comparable neighbor, Armenia, and on almost every socio-economic indicator it massively lags Russia. It is a democracy, but the quality of its democracy is not substantially better than that of Russia, which countless Western pundits describe as an authoritarian kleptocracy returning to the USSR.

In place of building the foundations for sustained long-term growth, Saakashvili has instead been busy undermining what little of it exists. No amount of reforms to make life easier for capitalists can compensate for the abysmal quality of the Georgian education system, and Saakashvili’s wanton curtailment of the only partial remedy for it, university access. He is at essence a blowhard, passable perhaps as a mercenary lawyer, but utterly unqualified for the work of statesmanship. He pontificates about building huge new cities on swampland (complete with “seven star hotels”), demands Slavic countries stop calling his country “Gruzia” as they have done for centuries, and arrests Russian tourists who dare holiday in his country for the mere suspicion of having passed through breakaway Abkhazia. Russian language schools are closed down, and the main Tbilisi boulevard is renamed in honor of G.W. Bush, while the latter was still President to boot!

What emerges of Saakashvili is a small, petty and vainglorious man, who blames all of Georgia’s problems on his “Mongoloid” northern neighbor and deflects all criticism of his ham-fisted rule by arresting the critics as Russian spies. He presides over “Potemkin Georgia”*, hyped as a tiger economy of the Caucasus by ideologues and paid-up PR men, but in reality fast becoming an isolated Cuba of the Caucasus.

If the good people of Georgia accede to this, it is of course their right as a sovereign people. It is also understandable that neocons who appreciate his irrevocably pro-Western science, libertarians dreaming of culling labor laws and defunding public services, sundry Russophobes operating on an the-enemy-of-my-enemy-is-my-friend basis, and plain paid-up PR men would defend Saakashvili’s record. But it is also then incumbent on people of honesty and integrity to publicize the lies of his apologists (Andrey Illarionov, David Hamilton, Garry Kasparov, Valeriya Novodvorskaya and Vladimir Bukovsky, Giorgi Badridze, Randy Scheunemann, Jennifer Rubin, Eli Lake, Melik Kalyan, etc), and continue revealing Saakashvili for what he really is – an emperor with no clothes.

Because even if Saakashvili is hellbent on undermining the future of his own country, he should not be allowed to do the same again to Abkhazia or South Ossetia – or for Potemkin Georgia to be portrayed as a model of good and effective governance for other countries to follow.

* Yes, I’m aware that “Potemkin villages” are probably a historical urban legend. But as the term is regularly and uncritically used as regards Russia in the Western press, I don’t see the problem in turning the tables on them.

(Republished from Da Russophile by permission of author or representative)
 
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Anatoly Karlin
About Anatoly Karlin

I am a blogger, thinker, and businessman in the SF Bay Area. I’m originally from Russia, spent many years in Britain, and studied at U.C. Berkeley.

One of my tenets is that ideologies tend to suck. As such, I hesitate about attaching labels to myself. That said, if it’s really necessary, I suppose “liberal-conservative neoreactionary” would be close enough.

Though I consider myself part of the Orthodox Church, my philosophy and spiritual views are more influenced by digital physics, Gnosticism, and Russian cosmism than anything specifically Judeo-Christian.