External Affairs

Panama Papers: In Russia, a Week of Dis-Putin

In Iceland, the Panama Paper’s revelations brought 22,000 people into the streets and brought down the government. In Russia, two people showed up outside the Duma to call for Putin’s impeachment in light of the allegations. They were promptly arrested.

Russian President Vladimir Putin enters a hall before a meeting on the preparations for the upcoming Victory Day, marking the anniversary of the victory over Nazi Germany in World War Two, at the Kremlin in Moscow, Russia, April 5, 2016. Credit: REUTERS/Alexander Zemlianichenko

Russian President Vladimir Putin enters a hall before a meeting on the preparations for the upcoming Victory Day, marking the anniversary of the victory over Nazi Germany in World War Two, at the Kremlin in Moscow, Russia, April 5, 2016. Credit: REUTERS/Alexander Zemlianichenko

Moscow: The Monday morning Moscow sunshine rays must’ve been exploding off the golden skull on press secretary Dmitry Peskov’s $620,000 watch when he warned his nation about the Panama Papers. According to him, the biggest leak of confidential documents in the history of investigative journalism was an “information attack“ intended to “kill“ the news about Russia’s success in Syria in the name of a new international phenomenon called “Putin-phobia“.

President Vladimir Putin’s press secretary could only express his disappointment that “the traditions of high quality investigative journalism have disappeared completely.“ He denied the offshore account allegations against his wife and watch-buyer, the ex-figure skater Tatyana Navika. He insisted that the Kremlin wouldn’t take legal action over the Panama Papers publications.

The Russian attorney general promised to investigate the Panama revelations the next day. The press secretary’s words on Monday were, to some extent, empty. But they were also foreshadowed.

On March 27, Peskov warned, “Russia is in a state of information warfare with the West.“ He said that an “information attack“ by the West on Russia was imminent. He could have been referring to Panamagate. He could have been referring to the report published by the Organised Crime and Corruption Reporting Project on March 31, which describes the suspicious real estate dealings of Putin’s friends. It’s not clear.

Russian spin-doctors call this tactic of forecasting, “information attacks“ a “pre-emptive strike.“ According to what the political PR expert Andrei Sharomov told the Russian news blog, Meduza, politicians “offer voters and journalists your own interpretation of the story, before they can offer theirs“ in order to “overcome a crisis situation“.

Peskov bothers with such sophisticated PR strategy, but many journalists will wait for him to tell them what to write anyway. Popular publications like Izvestia and Lifenews ignored the scandal for 16 hours, until Peskov’s speech gave them the go-ahead. “The Kremlin Explains the Publication (of Documents) About the Russian President as “Putinphobia,““ reported Izvestia docilely a few hours after the press conference.

Russia Today’s headline on Monday was “A Record Leak of Putin-phobia: World Media again Pipes up about Russia’s president without any Good Reason.“ RT also published two stories about Petro Poroshenko’s offshore tax haven, solemnly mentioning Transparency International’s call that he must declare his assets publically. Apparently, an “information attack“ based on mere “speculation“ is concurrently valid enough to discredit the Ukrainian president.

And in fact, the heads of the Russian State owned VTB bank and the national Ukrainian bank “Avangard” implicate each other in their offshore dealings.

Whenever there is the lure of media spotlight, one doesn’t have to wait long for the jesters to join the party. The American journalist Robert Bridge opened his column for Russia Today with the amazing sentence, Is it any coincidence that “revelations“ on the so-called Panama papers – which purport to expose a money trail leading to the door of President Putin – were served hot on an unsuspecting public between April Fool’s Day and NATO’s 65th birthday?“

I said “jester“ because I hope Bridge was just kidding. The spun and incoherent coverage of the Panama Papers by Russia’s publications with the highest circulation appears to create an environment where earnest discussion is impossible. Stuck watching a horror show where the actors keep fluffing their lines, there is nothing to do but laugh.

Which is what the opposition politician Alexei Navalny, told the Financial Times, “The reaction in Russia is ‘ha-ha, they only found 2 billion? It’s petty cash for personal expenses’.”

Quite a few Facebook statuses in Moscow are joking something along the lines of, “Now Putin’s approval ratings will go up even more!” A friend tried to explain this to me, “In Russia we say that those with authority should have a lot of money.”

Also widely shared is a video by Current Time TV, an online news service, jointly produced by VOA and RFE/RL, which juxtaposes a recording of Putin’s friend, Sergei Roldugin playing the cello as the Russian leader delivers a speech on the need to end offshore holdings.

Putin gave this speech on “deoffshoreisation“ in 2011. He told business leaders, “ We need to bring our assets back here. What are we afraid of? We need to improve our tax system.“ His audience laughed. Putin laughed, pulled himself together, and said: “it’s not funny.“

The mayor of Odessa, Gennadiy Trukhanov, who is linked to an offshore account, definitely agreed that offshore accounts are not funny. He is quoted calling the Panama Papers, “an unsuccessful April Fool’s joke.“

And State Duma Deputy Victor Zvagelsky, also linked to an offshore account, was so unamused that he promptly announced his intentions to file a libel suit against the editorial board of newspaper Novaya Gazeta.

Corruption may often be a punchline in Russia, but for a president who luxuriates in always being given the benefit of the doubt by his public, “Putin is corrupt“ wouldn’t be a laughing matter.

So yesterday, Russia’s president took time to condemn the papers in person. He announced that he was proud to have a friend like Roldogin, the cellist and childhood buddy who was revealed be at the centre of the offshore activities that benefit Putin’s closest circle. Sergei, according to Putin, is an entrepreneur, not a businessman who “is spending all his earnings on buying musical instruments for Russia.”

At least somebody is investing in schools. Russia’s budget for 2016, also known as the “stagnation budget“ or the “last budget“ imposed savage spending cuts on education, as well as healthcare and science.

Opposition politician Gennadi Gudkov grumble-blogged on Echo Moscow, “In a few years time, at least we know where to find the funds for our budget.” According to the think tank INDEM, corruption costs the country between a quarter and a third of its total GDP. That’s six times more than the sanctions imposed by the West.

 Echo Moscow is one of the few liberal opposition-minded publications in Russia which took the Panama Papers allegations against Putin seriously. But these independent outlets are drowned out by the wealthier and bombastic state-run PR machine.

In Iceland, the Panama Paper’s revelations brought down the government. 22,000 protesters demanded the resignation of their Prime Minister, Sigmundur Gunnlaugsson on Tuesday.

On the same day, in Russia, two people showed up outside the Russian State Duma on Tuesday. They were both from Russia’s Progress Party. They wanted to call for Putin’s impeachment in light of the Panama Papers allegations. They were promptly arrested. A passer-by, who stopped to take a photo of them, was also arrested.

Several media experts have claimed that corruption is too widespread in Russia for the Panama Papers to have much impact, but this is a bit of a cliché. It ignores the fact that the government’s crackdown on human rights, the foreign agent law in particular, has made Russia a bell jar for political protest and    has stigmatised some of the activism against corruption.

Putin is accused of corruption and it’s Putinphobia. Alexei Navalny, who heads the Anti-Corruption Foundation (FBK), visited Novosibirsk two weeks ago and people threw crushed pastries and liquid-filled condoms at him.

Emma Lantreev is a Moscow-based freelancer.