Russia's Duma elections next month are almost certain to cement the power of forces loyal to Russian President Vladimir Putin. That outcome is likely to confirm Russia's emergence as the most divisive issue in the EU since former US secretary of defense Donald Rumsfeld split the continent into "old" and "new" Europe.
In the 1990s, EU members found it easy to agree on a common approach to Russia. They coalesced around a strategy of democratizing and westernizing a weak and indebted Russia.
That policy is now in tatters. Soaring oil and gas prices have made Russia more powerful, less co-operative, and less interested in joining the West. Today, Europeans cannot even agree on the nature of the Russian regime, let alone what policy to adopt toward it.
Part of the confusion lies in Putin's skillful political positioning. On the one hand, he needs to maximize his control of the economy and society in order to raise wages and pensions and to keep opponents down while nourishing the long tail of patronage that keeps him in power.
On the other hand, Moscow's elite -- fearing that their assets may be expropriated by a future government -- wants to avoid international pariah status so that they can see out their sunset years in the safety of the West if the need arises.
A tightly knit group of political consultants has helped Putin resolve his conundrum. Rather than establish a dictatorship, they helped Putin use the trappings of liberal democracy to consolidate power. By establishing fake opposition political parties under the Kremlin's thumb, creating pseudo-pressure groups and organizations such as Nashi ("Ours"), and recasting the rule of law as an instrument of political power, Putin has tightened his control in a more effective and subtle way than many autocratic regimes. The possibility that he may run for prime minister to prolong his rule when his presidential mandate expires is a logical extension of this approach.
Though the EU has failed to change Russia during the Putin era, Russia has had a big impact on the EU. On energy, it is picking off individual EU member states and signing long-term deals that undermine the core principles of the EU's common strategy. On Kosovo, Russia is blocking progress at the UN. In the Caucasus and Central Asia, the Kremlin has effectively shut the EU out of regions where it has an interest in promoting political reform, resolving conflicts and forging energy partnerships.
In Ukraine and Moldova, the Kremlin has worked hard, with some success, to blunt the appeal of Europe. In the eyes of some neighboring countries, Russia is emerging as an ideological alternative to the EU that offers a different approach to sovereignty, power and world order. Whereas the European project is founded on the rule of law, Russia believes that when the balance of power changes, the laws should be changed to reflect it.
Moreover, Russia is trying to build a relationship of "asymmetric interdependence" with the EU. While EU leaders believe that peace and stability is built through interdependence, Russia's leaders are intent on creating a situation in which the EU needs Russia more than Russia needs the EU, particularly in the energy sector.
Although Russia's GDP is no bigger than that of Belgium and the Netherlands combined and its military spending a fraction of the EU's, the Kremlin has consistently managed to get the better of the Union. The central problem is that Europeans have squandered their most powerful source of leverage: unity.