Transcript of the beginning of the meeting:

Vladimir Putin: Good afternoon. I have invited you here today to discuss the start of the presidential campaign, a very important stage in our political life. As in any other country, this is a major, critical event, though it is accompanied by what is called “turbulence” to use the current expression. You are all taking part in this event in one way or another, by setting forth your opinion and commenting on the positions of candidates and of political forces in general. I’d like to thank you for this from the very start because not only the man in the street but even specialists find many things difficult to understand. No doubt, they require explanations and discussions. I’m sure you have read my recent articles (seeing as how this is your specialty). One more article was published today and I’d like to discuss it with you as well if, of course, you think it requires additional discussion or explanations because I tried to make it easy to understand. I assume you understand everything but just in case – if there are any questions, I’d be happy to respond to them and discuss them with you.

This is what I'd like say to begin. I'll refrain from lengthy speeches. It would be more interesting for us to have a free exchange of opinions on the current situation, prospects of our national development, the economy, the social issues, development of the state and of democratic institutions, and last but not least, the presidential campaign. This is all I’d like to say to start off. Good afternoon, once again.

Remark: Thank you.

Vyacheslav Nikonov (president of the Politics and Russky Mir foundations): Mr Putin, may I?

Vladimir Putin: Please, go ahead.

Vyacheslav Nikonov: Mr Putin, first of all I’d like to thank you for the opportunity to meet here. I think I will express a common sentiment that this is very important and we appreciate this opportunity to meet with you. Secondly, I’d like to congratulate you on your article – this is a very interesting piece, primarily because it deals with the problem of democracy and the formation of our statehood as a whole. This is not simply an issue of the electoral system because it also concerns the formation of the institutions of a law-based state and a democratic society. In fact, this is the main problem involved in upgrading the entire institutional structure – the executive and legislative government, maybe even the judicial power, federalism, feedback between society and the state – in fact everything that pertains to a law-based, capable state. Even if we take the experience of the leading Western democracies, we will see that a law-based state preceded the formation of the electoral system by several centuries. The former was founded by the Magdeburg Law and the Great Charter in the 13^th century. The first elections took place at the end of the 18^th century and voting rights appeared only in the 20^th century – they emerged for the first time in this country without producing a good effect on the Legislative Assembly. Institutions are very important. You deserve credit for speaking about all this and not only about pressing issues in your article. Today, people are certainly also interested in urgent issues.

I have a number of questions for you relating to this. What do you think about the future of the Russian electoral system? I’m referring primarily to the selection of candidates for governors for universal elections and elections to the State Duma. Also, do you think it makes sense to amend the constitutional article about elections to the upper chamber, the Federation Council?

Vladimir Putin: Thank you. Shall we start with voting rights? In fact, they are set forth in the package of papers submitted by Mr Medvedev to the State Duma. They are all set down on paper. As for party development, I’m sure it will lead to an increase in the number of parties. The only thing to which I have always paid attention and to which I would like to draw your attention, and that of the public, is that we must by no means allow… Our country is complex – it is not merely a federation. Our country is unique because it has ethnic territorial formations. They are very few in the world, if there are any. I’m sure you remember that in the Soviet times Lenin, the founder of the Soviet state, suggested the idea of establishing autonomies. Stalin categorically… After Lenin’s death he implemented this idea that he had initially objected to. I think his famous article was titled “On the formation of autonomies...”

What is the result of all this? We have autonomous formations, that is, ethnic groups linked to a territory. If we start establishing smaller parties, and we are moving towards this, although there is some sense in it… We must by no means allow for the formation of some ethnic parties if we do not want to pull the country apart. This is the first point I’d like to emphasise and we should take it into account during the final adoption of the relevant laws. I’m speaking not as one of the presidential candidates; I’m talking about the future of this country, the destiny of Russia. This is my first point.

My second point has to do with the election of governors. I also believe, and I have said this during the Q&A session, proactively in fact, that society is ready to expand democratic procedures in electing regional governors. But we must be very careful about this. We had direct elections in the past and where did they lead? Local oligarchs and sometimes outright criminals stood behind some candidates, exercising direct pressure on their election. It goes without saying that we cannot restrict direct democracy by citing these negative moments, but we must take into account this idea and also what I mentioned at the beginning  (a complicated structure of our federation and our ethnic territorial formations.

And we know that … Frankly speaking, there are highly sensitive issues for any country, any nation and any ethnic group. This includes national self-awareness, and this may degenerate into nationalism and separatism during acute domestic political processes. Unfortunately, candidates fighting for power in the regions are often guided by one universal rule: “The end justifies the means.” I find it deeply alarming that we may encourage such separatism and nationalism. This is not because it is endemic to this country, but because it would inevitably be used as arguments in the political struggle. We would simply not be able to avoid this. We must understand and realise this.

Consequently, when I said that such instruments of direct democracy must be expanded, I had in mind that we need some kind of a filter and a system of checks and balances. Negative control is one such element. At present the president has the authority to dismiss regional leaders. This is the law. The Federation must approve it, and it must be debated in the regions. Therefore, we will have to heed all these dangers and underwater reefs during such a straightforward and open discussion. All of us must work out such instruments that will guarantee the direct involvement of citizens in the regional elections, and that will increase the responsibility of voters for the results of the election process and safeguard the Federation and the nation from growing nationalism and separatism. We must assess these grave issues with the utmost attention. And what will we achieve, and what will the law’s final version be? This must evolve in the course of an open and straightforward discussion.

As far as elections to the upper house of parliament are concerned, I believe that, technically speaking, we can modify the system in line with these considerations. Incidentally, I have mentioned this issue during my Q&A session.

You have mentioned the judicial system, a highly important component of any democracy and any state. I have also mentioned various options for this in my article published today. The article contains a passage on administrative courts. But, in this connection, professionals draw my attention to the fact that property-related cases and property disputes usually involve legal entities. I am well aware of the professional community’s reaction to this.

Administrative legal proceedings involve a dispute between a private individual and the state, between a private individual and any government agency. Just like in any other country, private individuals must receive assistance during their dispute with the government because, no matter what the government may be, it is a powerful entity, and because an individual faces the government alone. We must create the required range of options for supporting individuals.

National administrative legal proceedings is the only sphere of judicial activity which has not yet been included in the Procedure Code. This country has a Criminal Procedure Code and a Civil Procedure Code, but it lacks an Administrative Procedure Code. As I see it, when we start tackling practical tasks of adopting the Administrative Code, experts will have to decide what cases should be listed among administrative court proceedings, and what cases should still be tried by general jurisdiction or administrative courts.

When I said that part of economic disputes could be examined by administrative courts, I meant that this could also serve as an option for settling property disputes between individuals and the government. But I repeat: the final decision has not been made, and I’m not imposing anything. I’m only speaking my mind. Certainly, we will have to discuss the jurisdiction of specific cases, while adopting the Administrative Procedures Code.

Andrei Okara (Director of the Centre for East European Studies): Mr Putin, the main essence and key trend of your first presidential term was the preservation of statehood and the reinstatement of the power hierarchy. Sovereign democracy, including the response to the so-called Orange Revolution, etc., was the essence and key concept of your second presidential term. Modernisation was the essence and key trend of Dmitry Medvedev’s presidency. If you win the elections, what will be the main essence and key trend of your third term in office? It would also be interesting to know your opinion about specific social classes and groups which top state officials and institutions should rely on during modernisation processes. And I would like to ask you a purely personal question: What Russian reformist or Russian Tsar or General Secretary is closer to you politically? Is it Alexander II, Alexander III, Stolypin, Nicholas II or Josef Stalin?

Vladimir Putin: I see. As far as the priorities are concerned, I would like to digress a little. This is not to avoid your question it is a brief look into the past. During my first and second terms as president I always thought about ways to make Russia’s destiny not dependent on one or two to three people, how to create a system where we could guarantee our sovereignty surely and certainly, a system that could quickly respond to the requirements of times, be alive and growing. That has always been the priority with us, but you are correct in mentioning the conditions in which we had to start. The first step was just to preserve the country which was falling apart before our eyes, to restore its economy and its welfare. I don’t have to remind you that pensioners went without their money for months – no one was paid in major industries or the army for months, either. That was the state of things. At that point we had to do simple things just to survive.

It is only now (I mentioned this in one of my articles) that we are finishing the first steps of the post-Soviet era and can begin making real progress. We have had no experience to fall back on until now. I often hear people discussing my articles (I’m happy to hear that both supporters and opponents discuss them) repeat one and the same point: why didn’t you do it before? Back then it was just not possible because we had no resources or conducive conditions and because these issues were not priorities. They were not of immediate concern because, above all, progress goes on and the situation keeps changing.

But I still want to say that we have been efficient in our efforts and this gives me the right to say we will continue to act as efficiently in the future as we did in previous years. So the top priority or task now (I also mentioned this in my article) is to bring this basic goal to its logical conclusion, or to create a government mechanism (I am not quoting the text word for word), an economic and a social system, that produces not only a living, powerful and healthy organism guaranteeing our sovereignty, but also one that is alive and one that can respond to the challenges of time, that are ever changing, and that can guarantee a good quality of life for years to come. This in a nutshell is our priority which is then broken down into smaller subtasks, and each of them is set forth in my articles. As for examples, our history, thank God, is replete with positive examples. Although our history is, unfortunately, mostly dark, bloody and clannish, there are many instances of dedicated effort and efficiency even before Peter the Great. Isn’t Alexander Nevsky an example?

Andrei Okara: Who is your favourite statesman? Or are there several?

Vladimir Putin: I like Alexander Nevsky very much. Then I like Peter the Great, and Catherine the Great in the early part of her life and statesmanship. Incidentally, Russia expanded territorially the most under Catherine. In this sense she was a more efficient monarch than Peter the Great: less blood and more acquisition.

Andrei Okara: Does the idea of a Eurasian Union spring from or correspond to this concept?

Vladimir Putin: The idea of a Eurasian Union corresponds to the requirements of the times for integration because … You know this better than anyone else. Look at what is happening in the world. America is integrating: Mexico, the United States, Canada. In Latin America you have Mercosur and other associations, not one but many. Asia is going through integration. And us? We are better suited for integration than most others. We have, however, one hidden threat to this integration, rather an obstacle than a threat, and this obstacle lies in emotional response because the former Soviet republics (at least many of their people) still fear Russia’s mythical domination. But Russia doesn’t need this anymore. And those who are clever and who care about the future of their economies and their people are thinking of integration and support it most vigorously.

But we have to tread lightly. We have established the Customs Union, with support from Nursultan Nazarbayev and Alexander Lukashenko. I must admit we argued a lot with Lukashenko, this is no secret, it was all in the press, but we must hand it to him – he is consistently for integration. There are, for example, problems on a common currency, but these issues, although serious, are based on personal opinion and will not deter us from staying on the road to integration. Now that we have the Customs Union and the common economic space we will progress slowly and steadily towards a Eurasian Union. This is not a whim. But why are we doing it? It is because we will benefit from it: we have a market of 170 million people and we don’t have the language barriers that the European Union does. Just go and sit in on any of their meetings. It’s a nightmare. I’ve said many times that I have close and even friendly relations with many of them. They tell me 90 minutes to two hours is the limit for sitting through it. But they stay on for five, seven, eight hours. Translations, for example, are handled by 27 translators alone. Mr Zlobin (director of Russian and Asian programmes at the U.S. Center for Defence Information) is smiling because Americans smile all the time. They say: it’s impossible to work with them, it’s impossible to make a decision. Issues can be substantive and technical. We have the least number of technical issues because we share a common language. Thank God those living in the post-Soviet space have kept the Russian language. There is also a common cultural code, even in the Muslim republics. The common values of the Soviet era have not been forgotten. There are many other things that we have in common. In the economy, it is infrastructure, energy, transport, communications. The European Union lacks all this. You understand, it lacks all this. But we have it. It is clear to everybody that this needs to be done, that we cannot fail to take advantage of this opportunity. It would be stupid not to. Many influential people in the former Soviet republics suffered from obsessive Soviet-era fears, and no headway was made. Now the general feeling is that some level of unification will benefit us all. Economic integration is much-sought after today. So why should we not work for it? We are working and will continue to work for it.

Alexei Chesnakov (Head of the research council of the Centre for Current Politics in Russia): I would like to thank you for inviting me and also for keeping us busy, because many of those present here have been discussing your articles which have been generating new  ideas. Political analysts like to discuss either technical or deep and thorough issues. So I would like to ask a question about the deep part. The parliamentary campaign just ended. During that campaign, there was an absence of thoughtful discussion. People mainly criticised the government, and opposition discussed its disagreements with the ruling party, but no one proposed any substantive solutions or proposals. I have heard a few minor suggestions but even those never evolved into any programme or project. What do people care about? Healthcare, education, transport, and corruption. There were some catchy slogans. But you have already told United Russia that we should not compete by making empty promises. The presidential campaign is now underway, and it is obvious that some of the opposition leaders are only chanting slogans without proposing any solutions, any specific proposals. Do you see anything at all in what they say in their programmes? Or do you think they have little to offer in the way of strategic ideas, the way presidential candidates should? I would like to hear your opinion.

Vladimir Putin: You know, they are all sober-minded and experienced people, and I greatly respect them, as I have mentioned. This is true, and I also have good relations with most of them. They certainly have statesmanship, and I am pleased to know that none of the presidential candidates would ever betray national interests. I am making this statement with full responsibility. I have known them for years, and I am absolutely sure of this. [Mikhail] Prokhorov is often attacked for being a billionaire. They might have a point… but I also think that he is a great patriot. Mironov, Zhirinovsky and Zyuganov are even more so.

At the same time, some things are downright impractical. If a candidate proposes a policy which is impractical and then, as president, tries to pursue it nonetheless, he is bound to do more harm than good. People will suffer. Although it might sound good, if they try to implement their projects, they will harm the country and the people.

I closely follow their programmes, and I knew that we were going to discuss this. For example, Mr Zyuganov proposes appointing city and district judges by election. (We have discussed judges.)  Good idea? Certainly. But all of you also realize what would happen, practically. We had the elections of judges in the Soviet era, which wasn’t bad. But do you remember how it went? It was a mere formality, the same way all other elections and taxes were. Did people pay taxes in the Soviet Union? Like hell they did. It was all good on paper, but the reality was different. The same is true for the election of judges. Today we have a right to elect justices of the peace. There are thousands of them across the country. People have a legal right to elect them. Has any one of them been elected, in any region? No! At the same time, there are representatives of the Communist Party, and LDPR and A Just Russia on every regional legislature. Why does this happen? Why are justices of the peace being selected by the regional assemblies even though people have a right to elect them by a direct secret vote? Why? First of all, it’s expensive.

Second – but just as important – in today’s reality, the election of judges would have a distinct political undertone. But judges should be above politics or political parties. I am not saying we shouldn’t work to improve the procedure for appointing judges. We have a procedure now which could be perfected. But it would be wrong to replace it overnight with direct elections. I am simply worried that this would “contaminate” the judges’ corps. We have enough problems without politicising it. Do we want this to happen?

In terms of economic proposals, Mr Zyuganov suggests establishing a “people’s collective ownership” of natural resources. Look, there is a mineral resources law which says that all subsoil resources are the property of the Russian Federation. This is already so. Why try to break into an open door? I don’t understand.

Here is another proposal – to nationalise the oil and gas industry, which implies that the government will issue development licences and charge developers for using subsoil resources. Today there are private oil and gas producers. At the same time, when Gazprom almost got privatised, your humble servant restored government control of this national gas producer. And I insist that I was right to do so, but this is an issue for a separate discussion. It may be a good thing to alter Gazprom’s ownership and its mode of operation one day, but only when the economy is mature enough for that. Now that I mention it, I must remind you that Gazprom sells gas at $75 per 1,000 cu m on the domestic market, while in Europe, it costs 400. This difference allows Gazprom to develop and to connect more consumers to the gas supply network. We have talked about this many times. As for nationalising all companies, how could this benefit us? The government’s goal is to receive the required amount of taxes from these companies, to make them pay. In this respect, I can tell you – I was surprised to learn this, too – that even the attraction of foreign investors to our private companies in the oil and gas sector can produce good results. When one of such companies, BP, bought into one of our oil and gas producing companies, tax contributions increased 20-fold – I repeat, not by 20% but 20-fold.

Therefore, we must teach everyone to live according to rules and laws. I don’t see anything outrageous in having a largely private economic sector. It is not good when companies do not fulfil their obligations and violate laws, but in this case they are not entirely to blame – the responsibility lies with the government, which failed to ensure that everyone without exception complies with the law, and it is this sphere that we must improve. We also have state-run or state-controlled companies such as Gazprom and Rosneft, which are playing a very important part.

Liberal political forces keep telling me that we should privatise everything without delay. Mikhail Prokhorov thinks so – I have excerpts from his programmes where he says that we must privatise everything, all these large companies immediately. But look, we have not completed the main task: de-monopolisation. The country’s territory has been divided among seven large oil and gas companies, which have monopoly domination in their sectors. If we let them act at will, it will be very difficult to control the situation, prices will start growing, and so on. For example, we discuss ways to ensure cheap fuel for farms during the autumn and spring seasons. How can we accomplish this task? Rosneft supplies the bulk of its resources at low prices and other companies walk in its wake. We should be grateful to all companies, including privately owned ones, which do their part. But the situation would be completely different if we did not have a leader such as Rosneft in addressing social issues. Hence, we will tackle all issues in due time. I believe that we should not privatise everything in this sector immediately, and one of the reasons for this is that it would halt development – state companies that do not work on the market attract resources very cautiously. Moreover, they are not very effective in some countries where this sector is fully state-owned.

Here is one more consideration: some say that they are lining their own pockets and so on. This is true, but then again, the state must make them work and must adopt laws that will make them operate within the limits of social justice. Besides, is there no corruption – our perennial headache – in state companies? Are there no crooks who line their pockets the same as in private companies? There could be even more of them in state companies. So I think that the formula of “Take everything away and divide it up” does not stand criticism.

Alexei Chesnakov: But it is very convenient.

Vladimir Putin: Yes, it is convenient but ineffective. Or look what Sergei Mironov has proposed – to cut prices of the AI-95 premium and diesel fuel to 15 roubles a litre. I know that Mr Mironov represents the left-wing forces. How much does AI-95 cost now?

Remark: 29 roubles.

Vladimir Putin: 29, nearly 30. But cutting it by half to 15 roubles? Of course, we would do this, but what would be the result? Even if we have only state-run companies on the market….

Remark: There will be shortages.

Vladimir Putin: You say shortages? No, not just simple shortages, but a total lack of the commodity. We would have no AI-95 premium motor fuel at the filling stations. Zero! It will end very fast, within two or three days. And no one will be able to do anything about it, because companies will stop producing this type of petrol. They will use oil to produce other commodities for the domestic market and for export. So this solution is completely unprofessional.

Take Vladimir Zhirinovsky’s proposal to nationalise banks…

Remark: …and also the post and telegraph?

Vladimir Putin: No, only banks but also commodities producing companies, and make people their shareholders. This sounds good. In fact it is a good idea, and many countries in the West have implemented it, and their citizens actively buy shares. But you know that we have problems with unit holders: people invest their money in a company and then they are deceived, so they request assistance from the state, and so on and so forth.

For example, I think it was the year before last when VTB issued additional shares and sold them to the public. I think that 200 or 300 people bought the bank’s shares. They are not unit holders and no one deceived them, but the market value of VTB fell during the crisis, and now they are demanding that we buy their shares back at the purchase price. Yes, they are, and VTB is ready to buy out their shares using its profits, not state funds. The idea is quite correct, provided it can be materialised. As for taking everything away, I have already expressed my opinion. Mr Zhirinovsky often quarrels with Gennady Zyuganov on many issues, but they fully agree on this one: “Nationalise.”

They also say: “Young people and low-income families will be issued free housing.” This is pathetic. Of course, we would like to issue housing to everyone, not only young families, free of charge. But I would like to ask Mr Zyuganov: Did everyone receive free housing in the Soviet period? Absolutely not. The problem was so acute that it may seem that we still cannot resolve it, but we will. By the way, housing is one of the social issues which we will resolve within five to eight years, in principle. But issuing housing free was impossible during the Soviet period and it is equally impossible now. In the Soviet period, everyone had the right to free housing, but did everyone have it? No, they didn’t.

Alexei Chesnakov: Mr Putin, sorry to interrupt, but the Communist Party criticized United Russia, you and Dmitry Medvedev during the (parliamentary) election campaign. They said: “Why haven’t you fulfilled your promises to war veterans?” The response was: “You did not fulfil your promises for 45 years after the war, so what do you expect from us?”

Vladimir Putin: Exactly.

Alexei Chesnakov: You said, “Do you expect us to fulfil these obligations within four or five years?”

Vladimir Putin: Yes, we said: “Housing can be bought using mortgage loans at up to 5% annual interest.” It is true that we have set the goal of keeping mortgage interest at no more than…

Yegor Kholmogorov (Editor-in-chief of Russky Obozrevatel online magazine): Mr Putin, what if land is distributed free, at least small plots?

Vladimir Putin: I have written in one of my articles that distributing land without infrastructure is senseless, because it is infrastructure that matters. I see Mr Fyodorov (Nikolai Fyodorov, director of the Institute of Socio-Economic and Political Studies, former head of the Republic of Chuvashia) nodding. He was a successful head of a regional administration for years. How long did you stay in office?

Nikolai Fyodorov: Sixteen years.

Vladimir Putin: He was head of the republic for 16 years. There's no gas or oil there, but the republic was successful and showed good results. And he knows what he is talking about. If you give land to someone in a remote area – what’s the use? A person needs to build a house and live in it. He needs infrastructure as well – power supply, running water, drainage, heating, roads – and that is what costs the most money. You see? There can be no freebies in this sense. The government can and must invest in infrastructure, but this doesn't come cheap. That is why I wrote in one of my articles that we should expand the zone around major agglomerations by 20 to 50 km, which is a cheaper solution and it's feasible.

Remark: That's government support.

Vladimir Putin: Yes, it is government support. But even there, of course, we have to simplify the allocation procedure and reduce the price of the land to zero. I agree with you, that is the way to go. In principle, supporting mass-scale private construction schemes and providing land free of charge – which, as you said, Mr Zyuganov proposes to implement – are the right things to do, but with the provisos I have just mentioned. This is my answer to your question about whether there is anything positive [in other candidates’ programmes]. Of course there is! But people are always thinking about how to make things even better.

Increasing child benefit three-fold… OK. I wish it had been increased ten-fold! Mr Mironov: fixing pensions at 60% of wages. In advanced market economies, 40% or so is the so-called replacement rate; this means that people receive 40% of their average pay for their last couple of working years. That’s how it is in Western Europe, in rich countries.

Remark: Even the ILO recommends 40%.

Vladimir Putin: It’s a recommendation…

In 2010, we edged closer to this target: we reached 36 to 38%. Why? First, we increased pensions by 45% in one go. Second, unfortunately, pay levels in many economic sectors went down. So that was the outcome. Generally, however, we are way under 40%. But we should still aim for this goal. But setting our target at 60%, that is 20% higher than in Europe and the ILO figure, is unrealistic. Of course, it's a good slogan, but that's all it is, a slogan.

Another suggestion is to equate corruption with high treason. That’s a good one. What else? Imposing a 20% tax on capital exports from Russia… You're laughing, but…

Natalya Narochnitskaya (historian, political scientist): What percentage?

Vladimir Putin: A 20% tax on capital exports from Russia.

Dmitry Orlov (General Director of the Agency for Political and Economic Communications): The amount of capital should be identified before the tax is imposed.

Vladimir Putin: We can do that. Last year's capital outflows amounted to $85 billion, if I'm not mistaken. But I want to draw your attention to the following: $60 to 62 billion out of $85 – (if memory serves me; I'm speaking from memory) – are our own investments into companies in other countries. This is a positive process, if, of course, it later leads to the same practice as the one adopted by certain companies… Mr Vekselberg, for example, has made investments in a Swiss company and brought some of the production over to Russia, establishing a joint venture with his Russian branch, and thereby improving technological standards in Russia. This is the right thing to do and the right direction for our development. There is nothing to be ashamed of here: we are right to pick and take the best. But to have the best, we have to invest money and buy the assets. In 2009, at the peak of the financial crisis when there was a global shortage of cash (causing prices of assets to plummet), we took the unexpected decision to give to our company, Rosatom, 50 billion roubles, if I am not mistaken, or around $2 billion, during one of the most difficult times for us and the rest of the world. They invested this money abroad, that was also an outflow of capital, but what did they do? They purchased uranium assets in Africa, the United States, Canada, and Kazakhstan, thereby boosting the assets of the whole country. They have provided us with enough raw materials to last us for 100 years. We know what banning and restricting capital exports lead to. The reverse side of the coin is that you restrict capital inflow as well. Where there are export limits, a potential investor will fear that he will be unable to leave the country. That’s the golden rule in investing: you restrict the outflow and we cut the inflow. It’s a very dangerous step.

Or, for example, look at what Mr Prokhorov is suggesting: We shall exempt the North Caucasus of taxes until 2020 in exchange for a corresponding reduction in subsidies to the region. We can do this, but the result will be a total loss of control over the resources that the region still has in its possession. I do not think that that is achievable or that it will have the anticipated outcome. That’s what is sad.

Many candidates are suggesting that we put an end to conscription and complete the transition to contract-based armed forces. We are proposing the same thing. I believe that this has to be done. The problem is that it costs a lot of money. A professional army is the right solution, given that military equipment is becoming ever more sophisticated. It stands to reason that state-of-the-art combat equipment should be operated by well-trained professionals. We need professionals. Moreover, we think that a military career should attract not only military school students but also students from civilian universities. But will we manage to do that by 2015? I'm not so sure. It will take a huge amount of resources. We need to calculate the costs. Everything ought to be calculated. We have specific plans and we will move in that direction.

Mr Zhirinovsky, for example, is proposing that we provide full support to the European Union – (Why should we? They are rich, richer than we are!) – with the proviso that they disband NATO. I think that that's unrealistic. This demand today is an unrealistic one, even though it's a correct one. No one needs NATO any more, it's a vestige of the Cold War. Mr Zhirinovsky is right. Good for him!

Sergei Markov (member of the Public Chamber of the Russian Federation): They are not NATO’s bosses…

Vladimir Putin:  Let us not try giving them so much offense, but you are right: they are not NATO’s bosses. That’s true. Others are the bosses. Let’s put it this way.

Banning government and state corporations from ownership of the media or media shareholdings… Mr Prokhorov came up with a good idea. I think we should move in this direction.

Alexei Chesnakov: You devoted one of your articles to this.

Remark: That’s right.

Vladimir Putin: That’s right.

Privatizing federal TV channels… I don’t think this is the right thing to do. Why? Because the government should have its own information policy tools, there should be an official, state-run TV channel. I don't see anything wrong with that. It's true that we should promote a free press, a private press… State-owned companies should withdraw from media ownership; they mustn’t put additional pressure on the press, although that isn't what they are doing anyway. Take, for example, Echo of Moscow radio station which is 75% owned by Gazprom. So what? This is not a matter of principle, but we can do it.

Mr Zhirinovsky suggests having political, economic and criminal amnesty. Are we talking about releasing all convicts, like they did in 1953? Frankly, I’m not sure what he means when he says political amnesty. I don’t think that we have any political prisoners, although they keep talking about them without providing any names. Why don’t they show us at least one person who is in prison for political reasons? I don’t know any. Some people were sentenced to 15 days in jail, but they have long since been released. If there's anyone else, I don't now about them.

Alexei Mukhin (general director, Centre for Political Information): Professional politicians, such as Limonov. His job is to go to prison.

Vladimir Putin: Listen, this is a different matter. We understand what this is all about. If someone goes to jail for 10 or 20 years, such as Nelson Mandela who fought for the freedom of black people… We don’t have anyone like that in Russia.

Remark: That’s set out in article 282.

Vladimir Putin: I’m not sure if this is a good time to grant amnesty to criminals. We're better off improving the situation in the penitentiary system and prisons. We should think about making our law more humane. At some point, amnesty can be granted, but I don’t see any reasons for large-scale amnesty now.

Please go ahead.

Natalia Narochnitskaya : Thank you very much. Mr Putin.  With respect to today’s article... I assume that no other country looks as deeply into the causes behind its age-old problems as Russia. Let’s see what all this radical opposition has to say. As an historian, I know that all attempts to develop our society in an evolutionary or reform-based manner, on the one hand, drowned or were blocked by officialdom or radicals. The tsar used to tell Pobedonostsev (Konstantin Pobedonostsev, a Russian state official): “You are like the brutal frost that doesn’t let anything rot, but doesn’t let anything grow, either.” After the Decembrist uprising was quelled, all attempts to even think of any ways to further Russia’s development were blocked. After the period of terror and the assassination of Tsar Alexander II, the reformist movement was suspended. Then came the October Revolution, and so on. You cited a great quote from Alexander Solzhenitsyn, one that is very close to me. You mentioned local government. Many thoughtful researchers who study Russian history believe that Russia’s main problem lies in the estrangement between the individual, the power and society. There’s no middle ground, as a very respected historian put it, between authorities and the elite, as they are now saying. However, this term was not previously used – they were referred to as the ruling class. I prefer to use the term “a socially active group,” because it shows more respect, and not everyone appreciates the term “elite.” If we start dealing with this problem, we’ll have to deal with more issues than just the unwillingness of the elite to share power with someone else. Deep down, society is used to this situation, although it never ceases to criticise the elite. Society prefers to remain an onlooker and criticise the authorities rather than becoming part of the governance process, because participation means sharing the workload. Perhaps we shouldn’t be so arrogant about our imminent success. This is clearly a very deep and complex subject, and this disease runs deep in our history. How optimistic are you about the potential for starting this process? My opinion is that this is our mission for the new political period. Will the moral degeneration of our times interfere with this work? As the Russian poet Tyutchev said, “not the flesh, but the spirit is corrupted these days, and the man is desperate in his anguish.” We won’t be able to eradicate corruption simply by sending people guilty of it to prison. You have stated this in your document, so we think alike in this regard. Clearly, in a society that has lost the notion of shame and sin, order cannot be maintained even by a policeman, because the policeman also comes from this society. In order to succeed in this, we need to improve our culture, our spirit and moral values, so that we can call someone a success not just because he had scraped together a fortune. Someone was suggested having successful people go to schools and talk to students. Among them are people who have managed to build a fortune in a matter of ten years – an unattainable feat in other countries, such as France. I believe that success is all about the ability to keep your friends and family in difficult situations. It’s about abstaining from lying, staying true to one’s own self and not stealing someone’s property when no one is looking. If we call this success, then society will define success differently as well. If not, officials will never do the things that you also mentioned in your document, namely, share power and property. I hope that you will agree that we need to improve our moral values, our culture, ideals and traditional values that have somehow gotten pushed aside. What we are seeing on TV is the cult of a lucky and successful character who is not burdened by moral dilemmas…

Vladimir Putin: You have painted a more picturesque and artistic picture of what I tried to say there. In fact, this is the way things are.

Natalia Narochnitskaya: We won’t be able to move forward without it.

Vladimir Putin: Certainly, this was exactly my point.

Natalia Narochnitskaya: The cultural spirit.

Vladimir Putin: You asked me whether it was possible. I believe it is. It will require time and effort on behalf of society, artists, the media, politicians, government officials and society itself. It’s a process. However, I’m confident that it can and must be positive. As a historian, you know that district councils started working in Russia at some point. Alexander Solzhenitsyn referred to them as well.

Natalia Narochnitskaya: Yes, and radicals put an end to it as always.

Vladimir Putin: Yes. But if this was possible back then, why can’t we revive it today? I believe we can. There is the fear that people don’t believe their opinion counts. This kind of paternalism became even stronger during the Soviet period: everybody now is expecting the authorities to do the right thing, while disassociating themselves from power. This is why they have often elected ineffective officials. I have provided the following example on many occasions: whenever there is some kind of an emergency or an accident, local authorities, at the level of governors, deputy governors, or municipal heads, simply turn a blind eye to them. Remember, whenever we have a cold spell or something like it – all local top officials simply vanish into thin air.

Natalia Narochnitskaya: Yes, I remember you saying this.

Vladimir Putin: What are we supposed to do with them? First, they are elected officials. Second, everyone is looking for culprits in the federal government. By the way, electing governors may become a disadvantage in the future. An unavoidable one, because I still think that we should go ahead and have them elected, not appointed. However, we should realise that even elected governors look for culprits in Moscow. Mr Fyodorov, please don’t take this personally. To them, everybody around is guilty except the ones who are supposed to be doing the actual work. They claim that the federal authorities in Moscow failed to allocate the money in time, failed to respond to the local needs, failed to provide assistance, etc. However, people should be able to see and understand who is responsible for what. This is very important. This kind of feedback mechanism must be in place, but if we keep saying that things are complicated or unlikely to happen, they will never get done, and we need to get them done.

Nikolai Fyodorov: Mr Putin, I should mention what you wrote in today’s article is absolutely right. Development of local government must continue through increased funding and taxation.

Vladimir Putin: Yes.

Nikolai Fyodorov: That is what causes delays and slips in efficiency.

Natalia Narochnitskaya: There is something about local government there…

Vladimir Putin: Yes, Mr Fyodorov, and the money must be spent wisely. This cannot be always done at all levels – at the federal, regional and local levels. For example, we will add some more funding sources for the municipalities but they will be taken partly from the regions. You know that taxes on small business, simplified taxation, a second type of tax, they go into the regional budgets. Let’s assume that we will reallocate them to the municipalities as I suggested, and I believe we will do so. Of course, we will do it in close cooperation with regional officials. The Finance Ministry has to work out which responsibilities the regions have to reassign to the municipal level along with the money. If we take away the money the corresponding responsibility has to be reassigned too. Some of the responsibilities could be reassigned to the federal level in order to release the regions from those that they cannot fulfill. This process will take time but it has to be done. We will continue doing it but gradually, without undue haste, and in cooperation with our colleagues in the regions.

Gleb Pavlovsky (President of the Foundation for Effective Politics): Mr Putin, may I?

Vladimir Putin: Yes, go ahead.

Gleb Pavlovsky: I have a question regarding your article. With striking persistence, you repeat the word ‘must.’ You know quite well that this does not always work in politics. Who will do it then? There is no such thing as a Soviet-style tandem of party and government here. There is basically no mention of a party of power or a ruling party. So my first question is: what is its future in this concept?

The second point concerns the government. Is there anyone better than you who could model a new government that everybody is really waiting for? The Constitution says that the government heads the executive branch. If there is neither this nor that, then we ‘must’ and somebody must do it, but who exactly? What will this power look like – this political power, government power – that will fulfill this programme?

Vladimir Putin: I will try to make my response brief. United Russia, as the foundation of the State Duma, is, of course, necessary, as I have already said. And I have repeatedly referred to the crisis period. If we had not had the opportunity to make decisions quickly on a legislative level, we would not have managed to address the crisis with such minimal losses. That period called for legislative decisions that needed to be made professionally, of course, but without excessive chattering and politicising. And we succeeded, with the help of United Russia. This unified key political force is needed in this State Duma as well.

As for the government, we will attract people from United Russia too, but not exclusively from there. This must be a professional government. I hope very much that it will include people with a good record both in administrative structures, and in the regions of the Russian Federation, and in businesses, perhaps -- young and vigorous people will come, professional people, people who will be able to tackle this task. We are currently choosing these people, but before forming the government, it is necessary to go through the system of elections. The elections will be held on March 4, and after this we will talk about the person who will be entrusted by the citizens of the Russian Federation with forming the government.

Gleb Pavlovsky: What will the coalition look like exactly?

Vladimir Putin: I have already said that we are not ruling out attracting people with political views that differ from those of the government. It is only important that they be professionals, but it will not be a coalition government in the classical sense. When various parties come to the parliament, none of them has a controlling stake, a majority, and they have to divide (in a parliamentary republic the government is appointed) these portfolios. I do not think this is very efficient. Why? Because when people with differing views on socioeconomic development come [to the government], the decisions that are made on the level of the executive power are very often a compromise and are often far from being very efficient. 

Nikolai Fyodorov: Unless it is absolutely necessary, one should not…

Vladimir Putin: Now, Mr Fyodorov, you see: professional management, and he asks such…

Gleb Pavlovsky: I am not asking about a coalition government, but about a coalition. You see, a coalition government that does not have a coalition in the society is not really necessary.

Vladimir Putin: I do not quite understand your question.

Gleb Pavlovsky: The problem is that the previous administration did not create, for example, a real public coalition around modernisation, therefore it turned into…

Vladimir Putin: Do you mean in a broad sense?

Gleb Pavlovsky: Yes.

Vladimir Putin: Yes, of course. In that sense, I believe that an attempt should be made, precisely to ensure that the public trusts has maximum trust in the future executive organs so that these or other public structures, social layers, the expert community, understand who has the authority to resolve the issues concerning national development and the development of sectors. Go ahead, please.

Alexei Mukhin: With your permission, I will ask a question that is most certainly interesting not only for your advocates but also for your opponents and even your enemies. It has not yet been discussed in experts' articles, and so I think it will be very interesting to hear. If you are elected President of the Russian Federation, how deep will be the rotation of the team be?

Vladimir Putin: You know, I would like to repeat what I have just said. After March 4, discussion of this issue will be appropriate and ethical; but I think that in advance of the presidential elections discussing it would not be quite right, I mean that we need to learn the will of the people first. When we get the results after March 4, we will discuss it.

More to be posted soon...