Vladimir Putin Paints Himself Into a Corner

Russia's President Vladimir Putin chairs a government meeting at the Novo-Ogaryovo state residence outside Moscow, July 30, 2014. Alexei Nikolskyi/RIA Novosti/Kremlin/Reuters

Is Vladimir Putin the backing-down type? Western policymakers are betting that he is, as they draw up ever-nastier economic sanctions they hope will force Russia's president to abandon his proxy war in Ukraine.

Russians, though, are not so sure—especially Russians who know Putin best. Alexei Kudrin was Putin's close friend and served as Russia's finance minister for a decade: Now he worries that "Russia's sociopolitical landscape has changed fundamentally" since the annexation of the Crimea. "We have become the West's adversary again." The Kremlin's "anti-Western rhetoric and … isolationist sentiments" risks "hampering the country's development in all spheres," Kudrin told the state-owned Itar-TASS agency. Certainly Western sanctions—especially those which have shut Russia's oil industry out of long-term international finance and banned the export of oil technology to Russia—are set to take a heavy toll on Russia's economy and will certainly put it into recession, or worse.

But will those dire consequences make Putin change course? Apparently, no. Instead of scaling back on support for Ukrainian separatists in the wake of the shooting down of Malaysia Airlines Flight MH17, Putin seems to have upped the ante. The U.S. State Department has published high-tech satellite evidence that Russian artillery batteries have shelled regular Ukrainian army units from across the border—the muzzle blast leaving telltale triangular scorch marks on fields of ripening wheat. And there's less high-tech evidence of Russian regular troops crossing into the separatist territories of Donetsk and Lugansk available on Instagram—for instance Russian Army Sergeant Alexander Sotkin, who posted a series of selfies on the photo-sharing site, which automatically pinned the location of Sotkin's phone to the village of Krasnyi Derkul, nine miles into Ukraine. The U.S. has also picked up on rebel use of the BM-27 Uragan, a truck-mounted multiple rocket launcher more powerful than the old Grad systems and used to destroy Ukrainian army artillery batteries, which could only have come from Russia. More seriously still, Washington has formally complained that Russia recently tested ground-launched nuclear-tipped cruise missiles—a clear violation of the 1987 Intermediate Nuclear Forces Treaty.

On the ground, then, it seems Putin has made his choice: to plough on with his support for the rebels, consequences be damned. Never mind that the outcome of that policy—accidental war with Ukraine—is insanely risky and damaging to Russia's long-term interests. In other words, he's behaving like a cornered tyrant, hitting out at those who try to contain him, angry and reactionary.

"Putin isn't panicking, scared or backing down, regardless of the consequences," argues Masha Gessen, author of Putin biography The Man Without a Face, in a recent essay. "He is engaged in a war of civilizations with the West." To Putin, spiritual, conservative, holy Russia is locked in an epochal struggle with the "homo-fascist West"—and the current scrap over Ukraine is, according to Gessen, just a battle in that long war.

Russia's clash of civilizations with the decadent West is certainly the message that the Kremlin-controlled media have been pedaling over the two years since Putin returned to the presidency—and which has been scaled up to a hysterical degree as the Ukrainian war has escalated. And the tactic of demonizing the West and uniting the Russian people against the "fascist" government in Kiev has proved devastatingly effective. Putin's personal approval ratings are over 80 percent, and a similar number of Russians believe Ukrainian forces were responsible for the downing of MH17. Russia's liberal opposition—which just three years ago brought 100,000 people out onto the streets of Moscow to protest against Putin's return to the Kremlin—has been almost completely silenced.

The Kremlin has even spun the threat of economic sanctions into an opportunity for Russia to increase its own self-reliance. "We will overcome any difficulties that may arise in certain areas of the economy, and maybe we will become more independent and more confident in our own strength," Foreign Minister Sergei Lavrov told reporters last week.

But at the same time, there are signs that Putin could—just—still pull back from the brink. Last week Kommersant journalist Andrei Kolesnikov—a veteran Kremlin pool reporter through whom Putin signaled his intentions to return to the Kremlin back in 2011—raised the possibility that Putin could denounce the Ukrainian separatists if an international investigation proves that they were responsible for the downing of MH17.

"If at some point it becomes evident that the insurgents had some connection to this, that would radically change [Putin's] attitude toward them—even if it was a fatal mistake. The children, the elderly people and adults slain for nothing are for [Putin]…a red line he would not cross," wrote Kolesnikov. "He will not cover up for those who did this if he knows they did it. He will not have this sin on his soul."

The Kremlin, through Kolesnikov, may be preparing the ground for a little backpedaling. Russia's U.N. Ambassador Vitaly Churkin also seemed to signal a change in the Kremlin line when he told CNN last week that the rebels in eastern Ukraine thought they had shot down a military aircraft around the same time that MH17 crashed. "The people from the East were saying that they shot down a military jet," Churkin said. "If there was confusion, it was not an act of terrorism."

Even the increase in the supply of heavy weapons to the rebels may be a prelude to peace talks. According to New York University's Mark Galeotti, the supply of rocket systems may be "the storm before the calm" that would "allow the rebels to give Kiev's forces a bloody nose" before Moscow steps in to offer a truce that will allow "peace with honor," which would stop the war and save the rebels' face—and Putin's own.

But that kind of limited climb-down could be too little, too late. The problem is that the shooting down of MH17 fundamentally changed the world's view of Russia—and the dynamics of the Ukrainian war. Before MH17, only hard-line conservatives in the U.S. Congress, like Senator John McCain, regularly denounced the Kremlin. Now, it's moderate senior Democrat senators such as Dianne Feinstein, Carl Levin and Robert Menendez who are calling for the breakaway Donetsk People's Republic to be named as a terrorist organization—and, by implication, labeling Russia a state sponsor of terror.

Before the unrest in Ukraine, Germans felt largely positive about Russia. But by mid-July, a Pew survey found that 79 percent of respondents in Germany and 72 percent of Americans had a negative view of Moscow, a shift of 19 percent and 29 percent respectively—and that was before the downing of the Malaysia Airlines jet. That means that politicians in the West—even traditional "Putin-understanders" like Angela Merkel—now have to respond to popular support for getting tough with Russia. And, last but not least, the surge of outrage that followed the MH17 catastrophe have emboldened Ukraine's new president, Petro Poroshenko, to fight the rebels to a complete defeat rather than compromise.

Over the past month, NATO has also swung into action to strengthen its eastern border. After years of wary appeasement of Russia, the alliance finally seems to be getting tough. General Philip Breedlove, NATO's top commander in Europe, said last week he wanted to transform a military base in Poland into a staging post stocked with weapons and ammunition in case a major NATO deployment in the region was needed. A planned exercise in Poland—code-named "Black Eagle"—has been beefed up with 1,350 British troops and armored vehicles, including Challenger tanks. Michael Fallon, the U.K.'s Defense Secretary, said the exercise showed Britain's "sustained and substantial support to NATO's eastern border" and didn't rule out "further enhancements." At the same time, British ambassador to the United States Sir Peter Westmacott abandoned all pretense of diplomacy and labelled Putin a "thug" and a "liar" on U.S. television.

Some Russians believe Putin is leading his country inexorably not just into isolation but something even worse. "Never before in its post-Soviet history has Russia been in such a horrific position as it is now," writes Yevgenia Albats, editor of the Moscow-based opposition magazine The New Times. "All possibilities, from a major war to a junta in the Kremlin, are possible. [Putin's KGB] entourage...has led him not just into a dead end but also into a nightmare in which he will go down in history as someone who has the blood of innocent children on his hands." If Putin doesn't change course, she argued, Putin would be "left without a country."

Unfortunately for Russia—and for the prospects of peace in Ukraine and justice for the victims of MH17—Albats remains in a tiny minority. Putin's media campaign of casting the "self-defense units" of Donetsk as heroes has proved so effective that he runs a major political risk if he abandons the rebels to defeat. In effect, the Kremlin has become a hostage to its own lies.

The Russian people are undoubtedly with Putin. But as sanctions begin to bite, it is not clear how much of the Russian elite will remain with him. Russia's business community are—like former finance minister Kudrin—plainly alarmed. Since his return to the presidency in 2012, Putin has attempted a program of "de-offshore-ization" of the Russian elite, banning officials from owning property or assets abroad and forcing state-owned companies to keep their money in Russia. Putin's third term "has been all about trying to decouple the elite from the West," says Sean Guillory of the University of Pittsburgh's Center for Russian and Eastern European Studies. "This is about reconsolidating the elite so that Russian state can exercise more control over them."

The problem is, it hasn't worked. Indeed, the Russian elite has been pumping its cash in exactly the opposite direction. According to the Russian Central Bank, capital flight has quadrupled this year to over $70 billion. And all Russian businesses depend on international money markets for their financing. "Elite politics are what really matters in Russia," says Guillory. "This will have long-term ramifications on the elites' attitudes to Putin going into the next presidential elections."

The long-term problem for Putin—and for Russia—is that by this point many Western governments, including the British and U.S., have abandoned the idea of ever returning to business as usual with Putin. "There is a school of thought, and it is growing, that says that sanctions aren't about changing [Putin's] behavior—they are about regime change," says one senior Western diplomat with detailed knowledge of Russia-NATO relations who was not authorized to speak on the record.

In other words, Western hawks want to make Putin a liability for Russia's business class and thereby hasten his demise. But beggaring Russia to get rid of Putin is a policy fraught with risk. Reckless Putin may be, but many Russians fear that the alternatives, from anarchy to ultranationalism, will be far worse.