Friday, June 30, 2023

Foreign Affairs : Russia’s New Time of Troubles It’s Not 1917 in Moscow—It’s 1604 BY VLADISLAV ZUBOK June 28, 2023

 

In the midst of the mercenary chief Yevgeny Prigozhin’s brief rebellion on June 24, Russian President Vladimir Putin compared the “treason” of the Wagner paramilitary leader with the revolutionary turmoil of 1917. “Intrigues, squabbles, politicking behind the back of the army and the people led to great calamity, destruction of the army and the demise for the state, the loss of enormous territories, and, in the end, the tragedy of civil war,” Putin said in a televised address, blaming “internal betrayal” for Russia’s defeat in World War I and the collapse of its empire. “What we’re facing is exactly a betrayal.”

As if taking his cue, some Western analysts compared Prigozhin to Lavr Kornilov, the imperial Russian general who, in August 1917, sent his troops from the frontline to Petrograd, then Russia’s capital, to clear it of revolutionaries—only to be accused of attempting a coup and imprisoned. More than 100 years later, many of Putin’s enemies asserted, Russia was imploding again. After seizing a major Russian military headquarters in the southern city of Rostov-on-Don, Prigozhin’s mercenaries moved north toward Moscow in an orderly column, passing one region after another without meeting any resistance. Meanwhile, not a peep was heard from the Kremlin, and rumors spread that Putin had flown out of Moscow. Ukrainian President Volodymyr Zelensky claimed that the Russian president was no longer in control. Mikhail Khodorkovsky, a Russian dissident in exile, suggested that ordinary Russians should arm themselves because a civil war was afoot.

Within a few hours, however, Prigozhin had called off his drive to Moscow and agreed to a deal brokered by Belarusian President Alexander Lukashenko: Prigozhin would avoid prosecution for treason by leaving for Belarus, and Wagner’s fighters could either go with him or agree to sign contracts with the Russian Ministry of Defense. What had seemed to be a drama that might culminate in Putin’s demise suddenly looked more like a farce.

Still, there is no doubt the Prigozhin affair has irreversibly changed the situation in Russia. Much remains uncertain about the rebellion and its aftermath. What is clear, however, is that in harking back to 1917, Putin and his critics and adversaries alike were reaching for the wrong historical analogy. What is taking place in Russia right now bears less resemblance to the events of 1917 than to those of an earlier era: the so-called Time of Troubles, or Smuta, which lasted from 1604 to 1613. During this period, the Russian dynasty of the Rurikids came to a violent end, and it took a decade of war and civil upheaval before the Romanov dynasty consolidated monarchical authority. In the meantime, Russia almost ceased to exist as a sovereign entity—a fate that could befall Russia again today because Putin’s personalized autocratic rule has made it hard to imagine an orderly succession.

MODERN VILLAINS, ANCIENT SCRIPTS

The stage for the Smuta was set by Ivan the Terrible, whose brutal and disruptive rule ended in 1584. Ivan exhausted his people and his finances by fighting endless wars to expand his realm, primarily in the Baltic. He decimated the Russian elite in a paranoid orgy of executions as he tried to consolidate absolute power. And in a fit of rage, he killed the son who could have succeeded him, transforming the throne into an object of fierce competition among elite clans.

What followed was a period of economic decline, famine, and conflict—including between an ambitious courtier named Boris Godunov, who occupied the throne from 1598 until 1605, and an adventurous young man who claimed to be Ivan’s son. The Pretender, or “False Dmitry,” enjoyed the backing of Polish-Lithuanian rulers, who coveted Russia’s resources, as well as the support of Moscow’s elites and, briefly, the Russian population. Godunov’s death in 1605 quickly led to the triumph of False Dmitry, who entered Moscow and declared himself tsar—only to be killed along with his Polish retinue the following year by a disillusioned mob.

Civil war and economic crisis engulfed Russia as the Smuta intensified. External enemies moved in: the Swedes came from the north; the Crimean Khanate, an arm of the Ottoman Empire, raided the south; and Polish troops ended up occupying the Kremlin. It is not clear what enabled Russia to survive. Nationalist historians have argued it was an explosion of patriotism and religious faith among the Russian people. What is certain is that two rounds of mass conscription helped the Russians retake the Kremlin from the Poles and gradually restore order. In 1613, Russians from all cross sections of society elected the “lawful” tsar, Mikhail Romanov, and peace with Western countries came five years later. 

In his lectures on Russian history published in 1904, the imperial historian Vasily Klyuchevsky argued that the Smuta formed “the underlying foundation of the modern way of life” in Russia. “Studying that time,” Klyuchevsky said, “feels like writing an autobiography.” One hundred and twenty years later, these words still hold true. A nuclear power with a sophisticated urban population, robust digital economy, and resilient financial system, Russia remains strangely antiquated when it comes to its sociopolitical structures and institutions, in some ways less modern even than the Soviet Union. As the writer and dramatist Vladimir Sorokin wrote in February 2022, “The principle of Russian power hasn’t even remotely changed in the last five centuries.”

It is an exaggeration that nonetheless reveals deep insights. Every time Russia begins to more closely resemble modern Europe, some jolt sends the country back to its medieval origins. Half a century of industrialization and modernization ended in the horrors of the Russian Revolution and Bolshevik tyranny. Three decades of struggle to overcome the Soviet leader Joseph Stalin’s brutal legacy seemed to bear fruit under Mikhail Gorbachev but ended in the collapse of 1991. Promising attempts to “Europeanize” the country in the 1990s eventually triggered the slide backward under Vladimir Putin.

Putin’s Russia does not resemble the communist dictatorship, but it is strangely archaic. In some ways, it seems better suited to the seventeenth century than to this century or the last one. Gone is the cultural capital of the imperial and Soviet times. Gone are the idealistic socialists and the enlightened bureaucrats. Gone are the notions of chivalry and honor that inspired Kornilov to try to save Russia from chaos. One does not even find the squeamishness that prevented the KGB from massacring the Russian opposition in August 1991, when a group of Soviet hard-liners failed to seize power from Gorbachev. Humanistic and enlightened impulses that for decades propelled Russia’s intellectual and social modernization are now underground. All that is left is a nearly operatic cast of figures: the isolated tsar, the supine patriarch of the Russian Orthodox Church, the treacherous courtiers, the money-grabbing warlords, and, finally, the audacious pretender—all of them acting according to the ancient scripts.

There are plenty of role models for Prigozhin in the history of the Smuta. He could be a modern Vasily Shuisky, the scheming and mendacious courtier who plotted to kill the Pretender. Another model could be the rebellious warlord and ex-prisoner Ivan Bolotnikov, who in August 1606 led a ragtag army to Moscow with the aim of killing the elites and electing a “people’s tsar.” Defeated by government troops, he was betrayed by his associates, blinded, and drowned. For a single day, Prigozhin became a pretender to the throne in Moscow—the embodiment of the hopes, expectations, and grievances of millions of people. Yet to the great frustration of many on all sides, he quickly shirked this role.

THE TRIANGLE OF STABILITY

The narratives of the Smuta say more about Russia today than the narratives of 1917, which are misleading for many reasons. First, there is a tsar in the Kremlin, not an impotent provisional government like the one in power in 1917. And nowhere—not even in the murkiest corners of Western libraries—are there Russian radicals such as Vladimir Lenin and Leon Trotsky. Moreover, there can be no comparison between Prigozhin and Kornilov. The latter was ready to die for the country and for democratic principles and did so less than a year after his failed march to Petrograd—on another march to liberate Russia from the Bolsheviks. Prigozhin, by contrast, is a mercenary leader who does not believe in anything. He is a cross between a courtier and a mob boss. He was incensed when his enemies, Putin’s other courtiers, prevailed over him and decided to take away his business, his money, and his private army. He never intended to become the next tsar. And his mutiny was not a careful plot to seize power but rather a desperate act to prevent Wagner from being dissolved.

The Smuta also provides a useful framework for understanding both the brittleness and the resilience of the Russian state. In the early seventeenth century, stability depended on the interactions of four centers of power, three domestic and one foreign: the tsar, the elites, the people, and external enemies. During the Smuta, Russia was embroiled in almost constant wars with its Western neighbors, above all the Polish-Lithuanian commonwealth. The domestic triangle, however, was decisive in determining the outcome of this period. Everyone understood that without the tsar, Russia would fall apart. The Russian elites, however, feared their own population more than they feared foreign enemies, and they were prepared to accept foreign rule or at least to compromise with Western potentates in order to prevent a mass upheaval from below and the redistribution of wealth. Yet every time they supported a Western-backed pretender such as False Dmitry, the masses rallied around the tsar, religion, and Russian statehood. The civil war in Russia ended in a new Leviathan, a covenant between the elites, the people, and the tsar.

This domestic power triangle still holds sway over Russia today. The Prigozhin mutiny weakened the tsar, denting Putin’s authority and image. His wooden appearances on TV screens at times when most people were asleep called to mind the troubled days of the 1991–93 period. Putin did not know what to say, and even his warning about “another 1917” sounded feckless. One does not stop a coup by telling people how bad it would be if the plotters succeed. Putin did not lead and did not take full responsibility for the chaos. His threats rang hollow. As farcical as it was, therefore, the putsch made the Russian leader weaker than before.

Yet the fact that Putin is weak does not mean the end of his rule is near. Russian elites, the military, and the people did not side with an adventurous warlord against Putin because they rightfully suspected that squabble and chaos would only hurt them, leading to another Smuta with colossal financial losses and possibly violence. The mutiny ended before the Russians were forced to take sides, but Prigozhin never stood a chance of winning over both the elites in Moscow and the broader population.

The longer the war in Ukraine lasts, the greater the risk of another Smuta in Russia. Russian elites are once again divided from the masses, just as they were on the eve of the Time of Troubles. The figure of the tsar is the only thing that unites them and allows the state to function. But if Putin suddenly disappears from the picture, his courtiers will face a stark choice: go down the road of Godunov and plunge the country into chaos or circle the wagons, avoid an internecine struggle, and enable all groups to elect a new president in emergency national elections.

Two days after the Prigozhin mutiny fizzled out, Putin addressed the Russian people once again, praising everyone, even the Wagner fighters, for their patriotic and sensible behavior. But he also mentioned the Smuta, a term of warning that is still understood by all Russians. The prospect of a nuclear power sliding into a modern Time of Troubles should scare Western countries as it scares the Russian people. The odds of a quick transition from wartime autocracy to a more accommodating, liberal regime in Moscow are long. And they are made longer still by the scripts of Russian history.

Foreign Affairs : What China Has Learned From the Ukraine War Even Great Powers Aren’t Safe From Economic Warfare—If the U.S.-Led Order Sticks Together BY EVAN A. FEIGENBAUM AND ADAM SZUBIN February 14, 2023

 


  • EVAN A. FEIGENBAUM is Vice President for Studies at the Carnegie Endowment for International Peace. From 2006 to 2007 and again from 2007 to 2009, he served as U.S. Deputy Assistant Secretary of State.
  • ADAM SZUBIN is a Distinguished Practitioner in Residence at Johns Hopkins University’s School of Advanced International Studies. From 2015 to 2017, he served as Acting Undersecretary of the Treasury and from 2006 to 2015 as Director of the U.S. Treasury Department’s Office of Foreign Assets Control.

When Russia invaded Ukraine in February 2022, China’s leaders attempted to balance two fundamentally irreconcilable interests. First, they aimed to bolster China’s entente with Russia to counterbalance American power and alleviate growing strategic pressure from the West. Second, although they backed Moscow, they sought to avoid unilateral and coordinated sanctions aimed at China’s government, companies, and financial institutions.

For a year, China has been performing the “Beijing straddle,” tacking uncomfortably between these competing objectives under the white-hot light of international scrutiny. China has generally refused to sell arms to Russia and to circumvent sanctions on Moscow’s behalf because preserving global market access is more important to Beijing than any economic link to Russia. Simply put, China has no interest in being Russia’s proxy. But Beijing has also tried to have its cake and eat it, too, by endorsing Russia’s rationales for the conflict, coordinating with Moscow diplomatically while it cautiously abstains in United Nations votes, taking full advantage of discounted Russian oil, and enhancing economic linkages to Russia that do not violate Western sanctions. Indeed, China-Russia trade rose by a staggering 34.3 percent in 2022 to a record $190 billion.

Beijing has also learned important lessons even as it struggles to maintain this balance. Specifically, it has closely studied the Western-led sanctions campaign. And it knows that, if tensions with the West continue to intensify, these same economic weapons may well be turned against China. Over the last 20 years, China’s leaders have watched as Washington honed and more frequently deployed economic weaponry, including sanctions, export controls, investment restrictions, and tariffs. But the major Western sanctions campaigns have generally not applied to China because they targeted second-tier economies, such as Iran and Iraq, or more often, marginal economies such as Cuba, North Korea, and Sudan. The current Ukraine conflict has, at long last, given Beijing an opportunity to study the strategy, tactics, and capabilities of a Western sanctions coalition as it works to cripple one of the world’s largest economies.  

Of course, in some ways, it is too soon for Beijing to draw the full range of lessons from the Western sanctions effort against Russia. The sanctions include both measures that have instant effect, such as asset freezes, and those that are designed to bite ever more deeply in the years to come. Among the latter are export controls on computer chips and advanced technologies and restrictions on helping Russia develop the deep-water, Arctic, and shale resources on which its future energy revenues depend. But China has already absorbed certain key lessons, some of which are sobering. Perhaps the most important has nothing to do with payment systems or oil tankers but is rather about the power of international partnerships.

DO AS I SAY, NOT AS I DO

The lessons China is drawing from the current conflict reflect, in part, the profound shift that has occurred in its own approach to economic warfare in recent years. Historically, China has criticized sanctions launched unilaterally by countries—most notably, the United States—as an illegitimate incursion on the targeted country’s sovereignty. In Beijing’s view, only the UN Security Council, where China can and has wielded its veto, sometimes in coordination with Russia, has the legitimacy to impose sanctions on a fellow UN member state. In the last two decades, China condemned U.S. sanctions on Cuba, Iran, Myanmar, and other countries that exceeded the prohibitions of the council, arguing that they “gravely undermined the sovereignty and security of other countries . . . and constitute a gross violation of international law and basic norms of international relations.”  

But China wielded its economic might unilaterally against its own adversaries throughout this period. It just did so quietly, or often by justifying action on “public health” or environmental grounds, to punish a company from a country with which Beijing was locked in a diplomatic dispute. China would not generally acknowledge its punitive measures to be “sanctions” and publicly denied that these steps had anything to do with geopolitics. For example, when Chinese dissident Liu Xiaobo was awarded the Nobel Peace Prize in 2010, Norway’s salmon exports to China not-so-mysteriously collapsed. In 2016, when the Dalai Lama visited Mongolia, hundreds of truck drivers for the mining conglomerate Rio Tinto, which owns 66 percent of the country’s leading copper and gold deposits, found themselves stuck in a massive traffic jam caused by a “temporary” Chinese border closureThe Philippines’ assertion of maritime claims in the South China Sea in 2014 led to a sudden Chinese declaration that tons of Philippine bananas were contaminated with pesticides; the Philippines temporarily lost the most important market for one of its largest exports. Similarly, South Korea’s deployment of a U.S. missile defense system provided by the South Korean conglomerate Lotte led China to shutter 90 Lotte supermarkets in China in 2017 for “fire safety.” China also quietly instructed its tourism sector to cut the number of Chinese group tours to South Korea. It is estimated that South Korea lost $5.1 billion in revenues as a result.

In these cases, Beijing clearly wanted the targeted countries—and the world—to understand that these were geopolitically motivated measures; it aimed to punish certain policies by these countries and discourage future choices and behaviors that would disadvantage China. But the informal nature of these actions allowed China to dial them up or down without any explanation and permitted Beijing to cling to its public claim that unilateral coercive economic measures have no place in the international system.

In the last three years, however, China has shifted course. It has embraced unilateral economic measures with vigor, establishing its own copies of all the main weapons in the U.S. economic and financial arsenal. In 2020, China’s Ministry of Foreign Affairs began to levy targeted asset freezes and visa bans against officials from Canada, the United Kingdom, the United States, and the European Union who criticized Beijing’s actions in Xinjiang and Hong Kong—a page taken from the U.S. Treasury and State Department sanctions on Chinese officials and groups. That same year, China’s Ministry of Commerce established the Unreliable Entities List to restrict designated companies from accessing Chinese goods and investment, mirroring the U.S. Department of Commerce’s own longstanding Entity List. In its 2020 Hong Kong national security law, Beijing also added sanctions for those interfering with China’s sovereignty over Hong Kong, even asserting extraterritorial reach—something Chinese officials have criticized especially harshly in the past—threatening sanctions against individuals and companies for activities conducted outside China.

Perhaps Beijing’s most sweeping response came in its anti–foreign sanctions law, passed in June 2021. This law allows the Chinese government to apply countermeasures to companies and individuals for a broad range of vaguely defined actions. Article 15 empowers Chinese officials to impose sanctions on any foreign individuals or companies that “implement, assist, or support actions” that “may be deemed to endanger China’s sovereignty, security or development interests.” The law also borrows from Canadian and EU blocking laws, making it a crime to implement foreign (typically, Western) sanctions on Chinese soil. 

This Chinese legal architecture is still fairly new, and Beijing has moved cautiously in implementing it, lest aggressive enforcement scare away Western businesses and capital flows into China. But Beijing’s economic arsenal is now complete and boasts a full complement of the unilateral sanctions and controls it still claims are unlawful. 

TOO BIG TO SANCTION?

That is the context for the fresh lessons Beijing has learned since February 2022. When Moscow’s tanks raced into Ukraine, the United Kingdom, the United States, and the EU scrambled to come up with a punitive response. In the 2014–15 Ukraine crisis, the West crafted careful sanctions over many months to impose costs on Russia, alter Moscow’s behavior, and obtain leverage for negotiations. In 2022, when it became clear that Russian President Vladimir Putin sought not merely more territory in Ukraine but a full takeover of the country, the scope of the sanctions response shifted to an immediate all-out economic war. Within days of the invasion, allied governments announced asset freezes on all of Russia’s foreign reserves across Australia, Canada, Japan, the United Kingdom, the United States, and the EU; sanctioned Russia’s biggest financial institutions; and severed their access to SWIFT, the secure messaging platform connecting banks worldwide.

No economy close to Russia’s size had been subjected to measures like these since World War II. At the start of the 2022 invasion, Russia had the world’s tenth largest economy by GDP. Its daily oil production was near 11 million barrels per day, almost three times larger than the Islamic Republic of Iran’s oil production at its peak in 2005. Russia was the largest natural gas exporter in the world and the leading supplier of key global goods and inputs, from fertilizer and grain to titanium.

From a geopolitical perspective, Russia, like China, is a nuclear weapons state and a permanent member of the UN Security Council. Also like China, Russia has been a member of a wide variety of global institutions. It is true that China’s economy is still ten times larger than Russia’s, and China’s footprint in the global economy—in terms of trade, investment, and capital flows—dwarfs Russia’s, particularly in its ties with the United States. But if Chinese decision-makers once believed that a first-tier economy was too big to sanction, this past year has been disconcerting.

No longer can Beijing simply assume that the West will never risk economic shocks over, say, a Chinese invasion of Taiwan. Beijing has just witnessed the United States and its European allies take on considerable national and global risks for Ukraine, an exponentially smaller and less global economy than Taiwan’s, which has the seventh largest economy in industrial Asia and provides a pivotal link in global supply chains. And Washington has greater historical, legal, and emotional ties with Taiwan than it does with Ukraine. China can no longer presume that the West will impose major sanctions only on marginal countries and marginal sanctions only on major countries.

Beijing has been surprised, too, by the ferocity of the Western response to Russia’s aggression. In the wake of the 2014 Donbas invasion, Putin and Chinese President Xi Jinping walked away with the lesson that the West—and especially risk-averse U.S. allies, of which there are many in both Asia and Europe—would not support costly sanctions on behalf of a third party. This time, that lesson does not apply. When Moscow’s tanks charged toward Kyiv, the gloves came off. An escalation ladder that had taken 18 months in the sanctions campaign against Iran was collapsed into a weekend. Even Russia’s oil and gas exports, which had been seen as too important to touch in 2014, were sanctioned. The West has moved more quickly than many thought possible to wean itself off Russian oil, and the G-7 recently rolled out a price cap system aimed at depressing the price Russia receives for its crude oil and petroleum products elsewhere in the world, at the same time ensuring that energy markets are still well supplied.

These steps required sacrifices. And the West has borne real costs in the form of inflation, higher energy bills, and gas shortages. But so far, with help from a mild winter, the coalition has held. The lesson for policymakers in Beijing is unmistakable: a major threat to international order can incur a very painful economic response indeed, even if it comes with costs for the countries imposing the sanctions.

FORTRESS CHINA

Countries make strategic decisions, including for war, because leaders weigh costs and benefits and then judge that aggression is worth the risk. China will not, therefore, eschew the use of force against Taiwan merely because it fears sanctions. China will, however, try to absorb lessons from Russia’s Ukraine experience about how to plug vulnerabilities, assure resilience, and create more options.

Since Putin’s difficult experience with sanctions in 2014–15, Moscow has boasted of a series of maneuvers to “sanctions proof” its economy; it proudly nicknamed itself “Fortress Russia.” Moscow built up its foreign currency reserves to $631 billion and largely shifted its reserves out of the U.S. dollar. By 2021, Russia had reduced its dollar holdings to 16 percent of total currency holdings, with Russia’s central bank purchasing $90 billion in gold and expanding its renminbi and other nondollar holdings. Russia introduced its own Mir national credit card system and an alternative to the Belgium-based SWIFT interbank messaging system.

If Russia had become “sanctions resistant,” however, it was not at all “sanctions proof.” As a matter of necessity, many of Russia’s repositioned dollar reserves had been moved to the highly liquid currencies of Canada, Japan, the United Kingdom, and Europe. When those jurisdictions moved in lockstep with the United States to freeze Russia’s reserves, nearly half of Russia’s foreign holdings—some $300 billion—were no longer accessible. Russia even saw a portion of its gold holdings immobilized because it had been storing them in jurisdictions that joined the sanctions effort. 

Russia’s other defensive measures proved even less successful. After seven years of work, the Mir credit card network had secured a few medium-sized bank partners in Asia. But when the U.S. Treasury announced in September 2022 that banks working with Mir would be viewed as circumventing Western sanctions, those banks in Kazakhstan, Tajikistan, Turkey, Uzbekistan, and Vietnam severed ties with Russia’s card system. Russia fared even worse with its System for Transfer of Financial Messages, its purported alternative to SWIFT. Unsurprisingly, there was not widespread demand for a Russia-based financial messaging system that had limited reach and was more cumbersome and less secure than SWIFT.

In today’s interconnected world, true sanctions-proofing is impossible. China has had more success than Russia in this respect, but it has also encountered some cold realities. For one, China’s State Administration of Foreign Exchange claims that China has reduced the portion of its foreign reserves held in U.S. dollars from 79 percent in 1995 to 59 percent in 2016. (China stopped providing a breakdown that year.) But the increasing role of China’s state-owned banks in foreign exchange purchases—purchases that are not reported—means that China’s true U.S. dollar holdings are unknown and may not have decreased by the reported amount. And China’s alternatives are limited. Unlike Russia, it cannot move any of its foreign reserves into renminbi—to protect against risk and manage monetary policy, reserves must be held in a different currency than one’s own. And the economies that have the depth to absorb a meaningful part of China’s foreign reserves are all part of the coalition that has stood up against Russia’s violation of international law. It is not clear where China can go.

China has also rolled out its own renminbi payment system, the Cross-Border Interbank Payment System and has set up mechanisms in its central bank to clear bilateral trade with countries such as Russia, skirting the use of the dollar and the euro. At the end of March 2022, CIPS had 1,304 participating institutions, a significant number, but about one-tenth of SWIFT’s participating institutions. China’s defensive steps have made more headway than Russia’s—China’s weight as the largest trading partner for the majority of the world gives it substantial clout in bilateral negotiations. But it will be difficult, perhaps even impossible, for China to convince the world’s advanced economies to entrust global financial flows to a Chinese-run platform.

So China has more leverage than any other nation to develop workarounds and alternatives to Western platforms, protocols, and institutions, and it is working overtime to do so after 2022. But Beijing is bumping up against economic and geopolitical realities that will not allow it to subvert the global financial system or to arrange for the renminbi to supplant the dollar and the euro as the dominant international currency.

BEIJING’S MISSING COALITION

Probably the most important sanctions lesson from the current conflict is the vital importance of coalitions. Washington has tremendous clout when it takes advantage of U.S. technology, financial markets, and the dollar. The sanctions on Russia, however, would have had a fraction of the bite (and Russia would have had numerous workarounds) had this not been a joint effort with Australia, Canada, Japan, South Korea, Taiwan, the United Kingdom, and the EU. 

China can wield frightening influence over its individual trading partners, but it does not have a corresponding coalition to muster. This is a liability on offense and defense. The limitations of China’s offensive economic weapons have already been seen in recent years. When Beijing targeted Australia and Lithuania with harsh measures, both countries withstood them thanks to economic and political support from a number of friends and partners. And China remains vulnerable to broad, concerted sanctions from the advanced economies of the world. The threshold for such an economic attack would undoubtedly be quite high, but another kind of deterrence is the fact that Beijing cannot know exactly how high.

For Beijing, the lesson is less about economics and more about diplomacy and relationships. As it reopens its economy after three years of lockdowns, China is working to rebuild relationships, host foreign leaders from Asia and Europe, make business deals, and complicate any putative American effort to forge a counter-China coalition. For Washington, the takeaway is the same—in any potential confrontation with China, the most valuable weapon in America’s economic arsenal will be the strength of its international partnerships.

Foreign Affairs : Is Russia Losing Its Grip on Central Asia? What China’s Growing Regional Ambitions Mean for Moscow BY TEMUR UMAROV AND ALEXANDER GABUEV June 30, 2023

 


  • TEMUR UMAROV is a fellow at the Carnegie Russia Eurasia Center.
  • ALEXANDER GABUEV is Director of the Carnegie Russia Eurasia Center.

Last month marked a diplomatic milestone for Chinese President Xi Jinping. He had invited the leaders of five Central Asian states to the city of Xian for their first-ever joint summit with China. The reception, with festivities worthy of an Olympic opening ceremony, was lavish even by Chinese standards. It made official China’s foray into a region that even today is often referred to, for better or worse, as Russia’s backyard. The pomp, and the praise that Xi and his guests from Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan heaped on one another, led some observers to proclaim a Sino-Russian scramble for Central Asia in which Beijing had just notched a victory at the Kremlin’s expense.

In truth, Chinese and Russian power plays in Central Asia are complex and subtle. China’s clout is growing, but Beijing is nowhere near usurping Moscow as Central Asia’s true hegemon. Moreover, whatever rivalry exists is far outweighed by overlapping interests and avenues for cooperation. Russia may be transforming into the junior party in a deepening, asymmetrical partnership with China, but in Central Asia it is still the dominant power, and it is becoming more, not less, willing to coordinate with China.

If Beijing’s expanding influence in the region reveals anything, it is that Central Asian states, more than three decades after their independence from the Soviet Union, are beginning to emerge as regional political actors in their own right, rather than as the objects of clashing great-power interests and ambitions. All five countries in the region must navigate a rising China, a belligerent Russia, and a deepening schism between these two neighbors and the West. To that end, they support Putin without fully turning their backs on the West, and they embrace China while hedging their bets with the help of Russia. Beijing and Moscow, in turn, are treading carefully, intent on accommodating both each other’s interests and those of Central Asian states.

THE ILLUSION OF ALIENATION

The prevailing wisdom is that if Moscow and Beijing were to come into conflict, it would likely be over their overlapping interests in Central Asia. In this view, China is exploiting a moment of Russian weakness occasioned by its disastrous invasion of Ukraine, and the Xian summit was its opening move.

To be sure, Russia’s global influence has suffered over the past year, and Central Asia is no exception in this regard. Take Kazakhstan, where a recent Gallup survey found that more people now disapprove than approve of Russia’s influence abroad—a first in the country’s history. And although governments in the region have not introduced their own sanctions over the war in Ukraine, they have mostly complied with the Western sanctions regime. But such deviations from Moscow’s agenda are pragmatic acts of economic self-preservation, not signs of a real break.

Just a week before the Xian summit, all five Central Asian leaders traveled to Moscow for the annual Victory Day military parade. The optics of standing beside Russian President Vladimir Putin to celebrate Soviet victory in World War II even as he wages war on neighboring Ukraine would not have been lost on his guests. But they likely decided that attending was a safer bet, certain that they would not risk Western punishment for attending a parade but uncertain how Putin, who had personally invited them, would react to a snub.

Since the start of the war, Moscow has taken care to occasionally remind its neighbors of their place in the regional pecking order. On numerous occasions starting last summer, for example, it has temporarily shut down the Caspian oil pipeline, which runs through Russian territory and serves as a vital conduit for Kazakh oil exports to Europe. Although in most of these instances Russian authorities cited technical issues or environmental concerns of scant credibility, the stoppages often seemed to come after the Kazakh government ran afoul of the Kremlin.

Moscow has plenty more levers of influence. It is a crucial source of basic goods for Kazakhstan and Kyrgyzstan, its fellow members in the Eurasian Economic Union. Russian trade with all of Central Asia is soaring, having risen by 20 percent in 2022. When Russia temporarily banned all sugar and flour exports at the beginning of the war, it contributed to budget deficits and record-high inflation across the region. Meanwhile, Central Asians continue to move to Russia in search of employment: according to Russia’s Interior Ministry, over ten million Central Asian labor migrants arrived in 2022, two million people more than in the previous year.

Undergirding these economic ties is the deep trust that binds political elites across the region. In Central Asia, just as in Putin’s Russia, power is mostly in the hands of gray-haired men who grew up in the Soviet Union. They have known one another for decades and speak the same language, both culturally and literally, as all are fluent in Russian. The first trip for new leaders and senior officials is nearly always to Moscow.

More and more often, Russian officials are returning the favor. In 2022, for the first time in ages, Putin visited all five Central Asian nations in a single year. Almost all members of Russia’s Security Council have made similar trips since the invasion of Ukraine, as have influential Russian business leaders. Several recent media investigations have shown that behind these friendly informal exchanges lie corruption schemes through which Moscow helps line the pockets of Central Asia’s ruling elites.

No less persistent is Russia’s role as a model of authoritarian stability. In recent years, Kazakhstan, Kyrgyzstan, and Uzbekistan have all implemented restrictive laws that closely resemble earlier Russian prototypes, from bans on “LGBT propaganda” to tightened controls on independent media and on nongovernmental organizations that partner with Western institutions.

More broadly, Russia still wields considerable soft power throughout Central Asia. Pro-Kremlin Russian media continue to disseminate propaganda across cities in the region, and not without success: Russia’s reputation may have taken a hit, but according to a recent survey by Central Asia Barometer, 23 percent of Kazakhstanis still blame Ukraine for the war (27 percent think that Russia is responsible, and half the respondents are undecided). In Kyrgyzstan, 30 percent blame Ukraine and only 19 percent consider Russia responsible.

UNDERESTIMATED COORDINATION

Like claims of waning Russian influence in Central Asia, the notion that China is angling to replace Russia as the region’s hegemonic power is inaccurate. Where the two sides disagree, Moscow has little choice but to back down and adapt. But on many issues, Chinese and Russian interests do not compete. The war in Ukraine and the deepening rift between China and the United States have brought Moscow and Beijing closer together. That interdependence extends to their relations in Central Asia.

Nowhere is China’s arrival on the scene more visible than in trade and investment, including through projects loosely tied to the Belt and Road Initiative. Its trade with the region is greater and growing faster than Russia’s, reaching $70 billion last year against Russia’s $40 billion. Yet that expansion has not come at Russia’s expense. Much of it takes the form of Central Asian commodity exports to China—exports that Russia, itself a leading commodities exporter, has little use for. Beijing has also taken care not to disrupt the Eurasian Economic Union: it has neither built a rival supranational institution nor officially sought free-trade agreements with Eurasian Economic Union members other than Russia. It does, of course, still conduct significant bilateral trade with these countries, which Moscow has no option but to accept, since it cannot compete with the market, technology, or money that Beijing has to offer.

In matters of regional security, too, Chinese and Russian interests and influence often complement each other. The top priority for both sides is to keep Central Asia’s current regimes in place and to keep the West—and above all, the United States—out. And far from being sidelined, Russia remains a towering presence: Kazakhstan, Kyrgyzstan, and Tajikistan all sit under its security umbrella as part of the Russian-led Collective Security Treaty Organization. Tajikistan and Kyrgyzstan also host Russian military bases and share a unified regional air defense system with Russia. Militaries in the region have close working relationships with their Russian counterparts, including access to Russian weapons at subsidized prices and joint training and education at Russian academies. Even Uzbekistan and Turkmenistan, although not members of the CSTO, have bilateral agreements with Russia that limit their ability to expand their security ties to other states. The agreements also give Russia the ability to intervene politically and militarily in Uzbek and Turkmen domestic issues—powers that Russia used when it led a CSTO “peacekeeping operation” to quell intra-elite clashes in Kazakhstan in January 2022. The episode was a forceful reminder that Moscow remains the only outside player that can use its military to prop up friendly regimes.

Unlike Russia, which views its security interests in Central Asia in terms of national security and geopolitical competition, China is content with protecting its commercial interests and making sure that developments in neighboring countries do not endanger political stability at home. Xinjiang Province, in China’s far west, borders Kazakhstan, Kyrgyzstan, and Tajikistan, and it resembles them in culture, ethnicity, language, and religion far more than it resembles other parts of China. Ever since these nations gained independence following the breakup of the Soviet Union, Beijing has sought friendly ties with them for fear that they might otherwise inspire or foment separatism in Xinjiang.

Another concern of Beijing’s is that Central Asia could act as a bridge for jihadis from Afghanistan to join forces with Uyghur extremists in Xinjiang, especially after a suicide bomber targeted the Chinese embassy in Bishkek, the capital of Kyrgyzstan, in 2016. Going back decades, but especially since the Bishkek attack, China has conducted dozens of joint military exercises with its Central Asian counterparts and held hundreds of high-level meetings with their military and intelligence agencies. It has also scaled up cooperation on military technology, participated in multiple exchange programs connecting Central Asian officers with Chinese military universities, and conducted regular joint border patrols.

Over the course of these exchanges, Central Asia has emerged as a testing ground for security instruments that Beijing has yet to use elsewhere. In Kyrgyzstan, for instance, it has pioneered the practice of deploying private security companies to guard Chinese investment projects. Another such experiment has been to dispatch Chinese paramilitary police units to patrol and police foreign borders: Since 2018, China has set up two such bases on the Tajik-Afghan border, acting as a force multiplier for Tajik authorities. Although the first of these bases came as a surprise and an irritant to the Kremlin, the second one, built in 2021, drew no such objections. It seems that Moscow has come to view China’s gradually growing security presence not as a competitive challenge but as an opportunity for burden sharing.

A LOPSIDED PARTNERSHIP

Russia’s change of heart about the Chinese bases in Tajikistan points to a broader shift: China’s rise as a dominant player in countries along its border—at this point an inevitable outcome—is happening not against Russia’s will but at a time when ties between the two countries are deepening, albeit asymmetrically and in China’s favor. Even if there is cause for competition in Central Asia, both Moscow and Beijing see friendly bilateral relations as a priority, especially amid their increasing confrontation with the West.

The Central Asian states themselves are landlocked countries wedged between two increasingly aligned great powers. They have nothing to gain from replacing near-total dependence on Russia with near-total dependence on China. All of them are trying to diversify their ties to the outside world, and in that respect, both Russia and China are equally important to them.

Down the line, the Sino-Russian power asymmetry could of course grow lopsided enough for Chinese leaders to interfere in Central Asian politics with little need for the Kremlin’s consent or aid. But it is unlikely that this would diminish their shared interests and their mutual support for authoritarian regimes in the region. The potential for cooperation remains far greater than the risk of conflict—and Central Asia a place where the Chinese-Russian axis strengthens rather than weakens.

LSE EUROPP Sergio Scandizzo June 30th, 2023 Compression and complexity: Making sense of Artificial Intelligence

 LSE EUROPP 

Sergio Scandizzo

June 30th, 2023

Compression and complexity: Making sense of Artificial Intelligence



Artificial Intelligence (AI) is expected to have a major impact on Europe in the coming decades. Sergio Scandizzo explains how the concepts of compression, complexity and depth can help us understand the potential implications of AI for our daily lives.


ChatGPT and other instances of ‘generative AI’ have recently taken the internet by storm and in parallel generated a mountain of critical comments ranging from the awed and terrified to the unimpressed and disparaging. On one side, is the traditional concern that AI can help people cheat, replace human judgement in key decisions for our lives and ultimately damage livelihoods by raising unemployment.


On the other, somehow illogically although perhaps as an understandable reaction to those fears, critics have tried to find fault with AI’s performance: it cannot solve certain mathematical puzzles (nor can the majority of humans); it writes essays that are predictable and solely based on searching the available literature (as most essays written by humans sadly are); on occasion, it can produce absurd results and reach biased and discriminatory conclusions (otherwise said, it looks as human as it gets).


So, while we tremble at the thought of a dystopic future of technological unemployment, AI-controlled governments, and stultified students, at the same time we berate current AI applications for not yet being that kind of God-like, infallible intelligence capable of solving any possible problem without fail. The reality is that most ‘failures’ of AI – not being original, basing decisions on existing information, numbly following rules or simply failing several times at complex tasks – are typical human features.


Some critics note that ChatGPT uses the most cited texts, assuming that those are the most scientifically reliable, to come up with answers. True, but what do most people do when they write an essay? First, they read the most cited texts. Similarly, others devise tricky mathematical questions to make the programme produce wrong answers (which are the kind of answers most humans would give). I wonder therefore about how many university essays, honestly written by mediocre students in the future, will look like they were written by ChatGPT or some other AI engine and attract unfair accusations of plagiarism.


The objective of Deep Blue or AlphaGO is not to be intelligent, but to play Chess or Go like an intelligent being (us). That they clearly can do so is disquieting perhaps because it suggests that it doesn’t necessarily take human intelligence to play these games, even at the highest level.


The same holds true for so-called creative tasks. If a machine can write a perfectly acceptable, even if not especially original, essay, it gives us pause for thought primarily because it forces us to rethink both the value of certain products of our intelligence and the meaning we attach to them. This is presumably what makes some commentators desperate to find fault in AI’s performance, as if they were keen to reassert the primacy of human intelligence against an existential threat.


Compression as intelligence

Let us try to look at the problem from another perspective. A ‘lossy’ compression algorithm is an algorithm that saves memory space by identifying statistical regularities across a set of data and storing a single copy of patterns that recur multiple times, without being exactly the same. The results of such technique are worse than what you get using a ‘lossless’ compression algorithm, where the original information can be completely reconstructed, but good enough for several practical applications.


It works especially well with images and music, much less well, unsurprisingly, with text and numbers. For example, if a lossy algorithm will store just one copy for several similar-looking areas of a picture, the reconstructed image may become slightly blurred but would still be recognisable overall. On the other hand, if the algorithm stores only the average of several similar numbers in a spreadsheet, the results will likely be useless.


Last February, science fiction author Ted Chiang wrote a very thoughtful piece in which he argued that ChatGPT works very much like a lossy algorithm applied to the internet, whereby it samples a large amount of information and repackages it in the form of text that is not exactly the same as any of the texts available online, but close enough to look both correct and original.


Aside from the fact that he may have stumbled across a definition applicable to a lot of what passes for creativity these days, what is especially intriguing is the use of compression as a metaphor for intelligence and specifically, his observation that the best way to devise a way to efficiently compress a set of data is to understand them.


Indeed, if we need to compress, for instance, the Fibonacci sequence, which is an infinite series in which each number is the sum of the previous two, we would do well by storing only three equations – F0 = 0 (applies only to the first integer), F1 = 1 (applies only to the second integer), and Fn = Fn-1 + Fn-2 (applies to all other integers) – rather than a very long sequence of integers hoping that the next user will guess the rule.


Complexity and depth

In a different context, Nobel laureate Giorgio Parisi argues that the problem of finding the simplest description of a complicated set of data corresponds to finding the scientific laws of the world and is “often taken as a sign of intelligence”. To clarify this idea, Parisi draws on the concept of the algorithmic complexity of a string of symbols.


The latter is defined as the length of the shortest computer programme producing that string as an output. In the Fibonacci sequence example, such a programme will incorporate, in the simplest possible fashion, the three equations above, thereby obtaining a very short description of an (infinite) sequence. On the other hand, if we examine the string “Dkd78wrteilrkvj0-a984ne;tgsro9r2]3”., nm od490jwmeljm io;v9sdo0e,.scvj0povm]]-” the shortest programme most likely will have to look like:



This is longer than the string to be printed. Equally important, however, is the concept of the logical depth of an algorithm, which is the actual amount of CPU time needed to execute it. In the Fibonacci case, while the algorithm is short, the actual amount of CPU required to execute it is potentially infinite as the sequence goes on forever. In the random string above, the algorithm is indeed not very efficient with respect to the length of the string, but its execution is very quick.


We say therefore that the former algorithm has low complexity and high logical depth, while the latter exhibits the opposite features. A good scientific theory has low complexity (it gives the simplest explanation of data) but potentially high logical depth (it explains a lot and may require a very long time to compute all its implications).


As an example, E=mc2 has very low complexity, but an enormous level of logical depth as it implies a very profound and far-reaching set of results. It follows, alas, that in many practical cases we settle for more approximated theories with higher complexity and lower logical depth either because of efficiency (approximated theory may be good enough for certain tasks) or because we simply cannot afford the CPU time required (Parisi gives the example of when we meet a lion on our path and we must make a decision in real time or else become its dinner).


This trade-off between complexity and depth is fundamental in understanding how intelligence, human or otherwise, works, yet most discussions of AI seem to ignore it. ChatGpt may well be, as Chiang says, an imperfectly compressed version of the available data, but so is most of our learning. Intelligence, amongst other things, is the ability to perform those somewhat imperfect compressions that balance cognitive objectives with our natural constraints.


Note: This article gives the views of the author, not the position of EUROPP – European Politics and Policy, the London School of Economics or the European Investment Bank. Featured image credit: Emiliano Vittoriosi on Unsplash


Sergio Scandizzo

Sergio Scandizzo is Head of Internal Modelling at the European Investment Bank.


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