Widespread demonstrations. On January 23rd there were demonstrations across Russia in support of Alexey Navalny, the anti-corruption campaigner. Navalny called for these after publishing a video alleging corruption by the President and his associates.
Continuity across presidential administrations is a hallmark of American relations with the outside world. Changes do occur, but more in response to changes abroad than in thinking along the Potomac, which remains remarkably consistent (even obtuse) despite alterations of political control
of the White House. Even Donald Trump was much more radical in rhetoric than in policy. Some of his most striking innovations — leaving the Paris climate accord and the Iran nuclear deal — will be reversed by Biden, restoring long-term continuity. One of the most consistent major components
of US foreign engagement in this period is Russia policy, which enjoys a basic unity not only between political parties but also between executive and legislative branches of government. Thus, continuation of an adversarial posture toward Moscow is almost certain from the incoming Biden
Administration, at least at the outset.
New sanctions are now inevitable. Russia almost certainly faces new, and possibly damaging, sanctions from the US in early 2Q21. This is because of the allegation that Russia is behind the SolarWinds hacking. The existence of a “smoking-gun” is hardly relevant as it is almost entirely accepted that Russia’s SVR agency is behind the hacking and, as such, it must have been approved at the very top of the Kremlin Administration.
Some reasons for optimism into Christmas. Since the US Presidential election and the rollout of the anti-Covid vaccine in November, the ruble has rallied 10% against the US dollar and the RTS Index has jumped 33%. Russia is cited as the second most attractive investment story (cheap, stable, and long-term growth) coming into 2021.
Relief bounce. Russian equity indices and the ruble have recorded double-digit gains since the start of November. This is because of the oil price rally, itself driven by optimism that Covid vaccines will be available early in 2021, and because the decline seen in September and October is deemed excessive by traders.
Joseph Biden is, de facto, President Elect of the United States. Converting that “de facto” status into “de jure” will take time, may be ugly and may even be violent. Still, no recounts or litigation are likely to alter the reality nor slow Biden’s progress to the White House in January.
EU goes by the book. The list of individuals sanctioned by the EU appears as highly formalistic and based on a textbook understanding, or misunderstanding, of Russian politics. With the possible exception of FSB Director Bortnikov, it is hard to rationalize why any of those sanctioned would actually have been involved.
Moved into active recovery spend phase. The government has moved into the more proactive phase of its plan to restore economic activity to pre-Covid level. The US$100 billion program started October 1st.
It may surprise the world, but American presidential elections actually have a fairly short formal campaign period. By tradition, campaigning starts on Labor Day — September 7th this year — leaving only two months till election day.
United Russia governor candidates do well. The candidates for governor positions who had been publicly blessed by President Putin all won in the Russian regional elections. The only non-United Russia governor who won is Alexei Ostrovsky, the LDPR governor in Smolensk, but he was also officially “blessed”. Both turnouts and majorities were healthy.