When President Bush arrived Sunday in Moscow to celebrate the 60th anniversary of the victory over Nazi Germany, Air Force One landed in a Russia that, despite continuing economic growth, finds itself in a troubling and precarious political situation. President Vladimir Putin's government increasingly deviates from the democratic achievements of the 1990s in favor of greater re-centralization of politics and economy.

The Kremlin seeks to subjugate and control many formerly independent institutions, including television and the legislative and judiciary branches of the government, and to retake some of the "commanding heights" in the economy. Recently calling the collapse of the Soviet Union "the greatest geopolitical tragedy of the 20th century," Putin has shown a far greater willingness than his predecessor, Boris Yeltsin, to try and bend the former Soviet republics, which are now independent states, to Moscow's will.

As a result, Russia's political stability, economic progress and relations with its neighbors are becoming more and more problematic. Given Russia's unique importance as the largest Eurasian nation, one of the world's largest oil producers, a nuclear superpower and a crucial U.S. partner in the war on terrorism, Bush very likely will use the visit as a way to assess the damage and to see what he can do to reverse the disconcerting trend.

Turning back

Although in the first three years of his first term the government undertook several important economic reforms, it turned out that, deep down, Putin identified Russia's vulnerabilities not with the remnants of the Soviet legacy of excessive state dominance of politics and economy, but, on the contrary, with political and economic decentralization of the 1990s.

Early on, the Kremlin renationalized Russia's main independent television network, NTV. Then the Kremlin sent a chilling message to political opponents and to free markets: It blatantly violated judicial independence and legal procedures in its case against Russia's largest private company, the oil-producing giant Yukos, and its founder and principal owner Mikhail Khodorkovsky. He was charged with tax evasion and fraud. After a rigged auction, Yukos' main division was taken over by a state-owned company.

In the political realm, Putin has proposed abandoning elections of independent candidates, who currently account for half of the deputies in the Duma, or lower house of Parliament, in favor of elections by party lists only. (The measure has not yet been approved by the legislature.) The change would make the balloting far more cumbersome and expensive to organize and give central and local authorities more opportunities for control and meddling. In a flagrant violation of the separation of powers, the Kremlin openly tinkers with the composition of the upper house of the Federal Assembly. "I am convinced," Putin told leaders of the Assembly in February, "that the personnel should be reshuffled to make the chamber's work ... more stable."

Perhaps the most damaging move in the long run is Putin's plan--passed by the docile legislature in December--to cancel the election of regional governors. They are now being nominated by the president and approved (or rubber-stamped) by regional legislatures. In a country of Russia's size, economic disparities and ethnic diversity, the return to a centralized state will put immense strain on the federal authorities and is bound to result in a major destabilizing crisis.

Democracy still flickering

Contrary to the grotesquely misinformed classifications (such as the one by Freedom House, a human rights watchdog based in New York), Russia is not in the same category of "unfree" states, such as China, Cuba, Iran, Libya, North Korea or Saudi Arabia. The legacy of the democratic revolution is far from extinguished.

Political opposition is free to organize, and though TV is under government control, the press is free from censorship, and many publications are quite critical of the Kremlin. People can demonstrate, form political parties and disseminate their views. Yet the dangers are real.

In the past several years, the center of gravity has been moved all the way up to the Kremlin. The political and social shock absorbers and stabilizing mechanisms of a democracy--local self-government, parliamentary opposition, independent judiciary--have all been weakened and eroded. With a steady decline in Putin's approval rating to the lowest levels since 2000 and the share of those who trust the president dipping below 50% for the first time, the system is unstable, and with a strong shock could falter.

What could produce this tipping point? Economic stagnation or even a downturn--which could come from a combination of falling oil prices, inflation or a reluctance of Russian entrepreneurs to invest in the system--could send such shockwaves. The revulsion over bad governance, especially corruption, also could trigger a dangerous upheaval. In January and February of this year, the country was rocked by mass protest rallies by pensioners, or retirees, who felt cheated by a restructuring of the country's social security system.

Terrorism as the wild card

Finally, another major attack by Chechen terrorists is a virtual certainty. More than 330 people, half of them children, died in the assault on a school in Beslan last year, and trust in the government plummeted. Another massacre could send Putin's approval ratings into a spiral, and thus lead to a government breakdown, if not collapse.

So what should the U.S. role be in averting such crises? Though Russia's economy is not as susceptible as it was in the 1990s, when assistance by the International Monetary Fund or World Bank was a must, U.S. influence is still considerable.

Even in the Soviet days, U.S. public opinion mattered a great deal to the Kremlin, especially when conveyed by a U.S. president at face-to-face summit meetings. The Russians want acceptance in the world of the "civilized" nations, such as at the Group of Eight economic summits, where the U.S. is the major sponsor of Russia's membership. For all its talk about "multipolar" world and protests against "hegemony" (a euphemism for U.S. dominance), Moscow and Russian people alike look to the United States (and not to France or Germany or China) as a model of economic might and political stability. Partnership with the U.S. is important to the Russian national pride.

The Russia visit gives Bush an opportunity to try to leverage this influence. In addition to expressing his concerns about the re-centralization in politics and economy at the private dinner with Putin on Sunday night, Bush would have been wise to raise the stakes by concentrating Putin's mind on the importance for the U.S. government and public opinion of the 2008 Russian presidential election. Its freedom and fairness will be crucial for U.S. acceptance. Any underhanded efforts to secure the outcome contrary to the will of the people--such as the actions taken in neighboring Ukraine--will not only mean the end of U.S. partnership, but will also turn Russia into an international pariah.

Leon Aron is a resident scholar at AEI.

The Putin Presidency: Reform and Retreat

In five years as president, Vladimir Putin has made economic and political reforms that were cheered by the West, only to come back months or years later to rein in these very changes. Events that have reshaped the Russian landscape:

1999

• December: For the first time, legislative elections result in a pro-Kremlin and pro-reform plurality in the Duma, the lower house.

2000

• March: Putin is elected president of Russia.

2001

• January: Russia implements a 13% "flat tax" on personal income of any size. The rate is among the lowest in the world.
  
• April: A division of the state-owned natural gas monopoly, Gazprom, takes over Russia's main independent television network, NTV, leaving Russian television without an independent outlet.
  
• July: After a decade of resistance by leftists, the Duma passes government-drafted laws to allow the purchase and sale of urban and commercial land. The end of the state monopoly on land means that companies and citizens own the land on which their factories and homes stand, unheard of in Soviet times.
  
• December: The Duma adopts the government-drafted criminal procedural code. It guarantees the rights of defendants and allows judicial control over arrests and detention. For decades, complete control of the legal process was in the hands of state-appointed prosecutors.

2002 

• January: To stimulate economic development and investment, Russia cuts the tax on corporate profits from 35% to 24%.
  
• June: Duma approves government-drafted legislation to allow the private sale of farmland. After eight decades of state ownership of arable land, the door is open to private farming.
  
• July: The Duma passes a government-drafted package of laws that allows younger workers to set up private accounts for up to 6% of their social insurance tax (an equivalent of the U.S. Social Security tax).

2003 

• March: Putin signs into law a plan for the breakup and subsequent privatization of the state-owned electricity monopoly UES. This action opens a way for privately owned energy generation. The move also encourages private investment, which was badly needed, into the decrepit system inherited from the Soviet Union.
  
• October: Mikhail Khodorkovsky, CEO of Yukos oil company, Russia's largest private firm, is arrested on charges of tax evasion and fraud. He denies the charges. Many Russian and Western experts see the prosecution as retaliation for political ambitions, financing opposition parties and resisting government pressure to toe the Kremlin's line.
  
• December: The pro-government United Russia party wins a majority in the legislative election on the platform of support for and alliance with Putin. The Communist Party of the Russian Federation, which used to have the largest faction in the Duma, receives 12% of the party-list vote, spelling the likely end of unreformed communism in the nation.

2004 

• Sept. 1: Chechen terrorists seize a school in Beslan. More than 330 people are killed, including 172 children, after federal troops storm the school gymnasium. In the wake of tragedy, the government is roundly criticized for its handling of the standoff.
  
• Sept. 13: Citing the need to strengthen the country in light of the terrorist threat, Putin proposes the elimination of gubernatorial elections and the abolition of independent candidacies in the Duma elections. These moves--clear body blows to self-government--signal a tipping point in what will become a systemic shift from democratic reforms.
  
• Sept. 30: The upper house of Russia's Federal Assembly passes a law that erodes Russia's judicial independence. The vote takes away from judges the right to elect a majority of the members of the Supreme Judicial Collegium, a body that approves judicial nominations and dismissals.
  
• December: The government sells Yukos' major production facility, Yuganskneftegaz, to an unknown firm that quickly "resells" it to a state-owned company.

2005 

• January: For the first time since 2000, public opinion polls show that less than 50% of the people trust the president. 
  
• January-February: Tens of thousands of pensioners across Russia hold rallies and demonstrations to protest changes in social security benefits. Protesters blockade roads and storm government buildings over a sweeping overhaul of the system.

Source: Leon Aron and Vance Serchuk, Foreign Policy and Defense Studies, American Enterprise Institute for Public Policy Research