Today's Opinions, Tomorrow's Reality 

Stagnant Future

By David G. Young

Puerto Vallarta, Mexico, March 20, 2018 --  

The embrace of the lifelong presidency is bad news for countries facing economic headwinds.

When Vladimir Putin's won re-election as president of Russia on Sunday, the country passed a new milestone in his authoritarian leadership.  In power since the end of 1999, if Putin serves out his new term, he will have controlled Russia for nearly a quarter century, longer than Brezhnev or any Russian leader since Stalin.

Meanwhile, at the other pole of the former Communist world, China's Communist Party removed presidential term limits two weeks ago, theoretically allowing President Xi Jinping to rule for life.  

Public acceptance of unlimited rule in both counties is driven by fading memories of the excesses of past strong men.  Leonid Brezhnev's 18 year rule over Russia and the rest of the Soviet Union ended in 1982. Mao The Tung's personality cult ended with his death in 1976, 27 years after taking control of mainland China.

There is something to be said for long-serving dictators.  They can get things done that are impossible for leaders with sorter terms.  Fidel Castro brought universal literacy and health care to Cuba.  Augusto Pinochet restructured Chile's economy to be the richest in Latin America.  Stalin made his agrarian country an industrial and scientific powerhouse.  

But most long-serving dictators trace their accomplishments to their early years, with latter years marked by stagnation and failure.  Libya's Muammar Gaddafi spent his last 30 years trying in vain to conquer or diplomatically dominate neighboring countries. Castro's lasting accomplishments were all complete long before both his death and the fall of the Soviet Union in 1991.   Mao's last decade was marked by the disastrous Cultural Revolution that set back China decades.  Stalin spent his last decade trying to shore up territorial gains in Europe that Russia could never hope to hold.

Outside observers have long expected Putin to follow this same path.  The easy gains of bringing stability to a chaotic post-Soviet Russia have been complete for a decade.  

More recent moves toward a military build up and foreign adventurism in Ukraine, Georgia and Syria are unsustainable for a country with a shrinking population due to low birth rates and high death rates.  While Russia's demographic trajectory has improved somewhat since Putin stabilized the economy, the population is still in decline, and the best and brightest continue to leave for better lives in Europe and the United States.

As a result, Putin's era of stagnation is probably already here.  It just isn't obvious because we don't yet have the benefit of hindsight.

Xi's rule over China is relatively new, rising to the head of the Communist party only in 2012.  But China, like Russia, faces big demographic and economic headwinds.  China's demographic problems are driven by its former one child policy that robbed the population of younger workers.  Today, China has a huge population in middle age, but a relatively small number of young people.

As a result, its working-age population has already begin to shrink.  Developed Western countries facing this problem (like Russia and Japan) enter a period of slow decline.  China can ward this off for awhile by relying on migration of its rural poor to replace retiring urban workers.  But even this won't last forever.  China's population is projected to drop by 40 million by 2050, and lose a third of is working age population.1

While China faces real challenges, it certainly won't become a stagnant economy like Japan overnight.  But those that have watched the country's meteoric rise since the 1980s are unlikely to see such dramatic change in the coming decades.  The best China can hope for is a gentle leveling off.

These trends are bad news for the legacies of dictators like Xi and Putin.  While dictators can accomplish much with rising societies, history is not kind to authoritarians who preside over decades of stagnation. The best they can hope for is a natural death after which they are derided like Brezhnev.   At worst, they can be arrested and indicted like Pinochet, or stabbed in the anus and run over by a truck like Gaddafi.2


1. Business Insider, This is a Pretty Worrying Chart for China's Demographic Future, May. 16, 2016

2. New York Times, A New Libya, With ‘Very Little Time Left', February 27, 2016