Misha’s freedom laboratory

On my last night in Tbilisi, the capital of Georgia, a Frenchman was murdered in my hotel. As it was the Caucasus I immediately assumed there was some murky political motive behind the stabbing. I was with a group of other journalists on a tour of the country sponsored by the Georgian government, and when we discovered the victim was involved in the modernisation of Tbilisi’s transport system, our suspicions only grew. It turned out to be a private liaison gone horribly wrong—a “normal” western murder in a country striving to be an outpost of the west in a dark corner of the post-Soviet world. Georgia aspires to be not just an outpost, but a model. Though the country is home to only 4.2m people, President Mikheil “Misha” Saakashvili aims to use its “soft power” to make it a beacon of political and economic freedom—much like west Berlin during the cold war—and an alternative to the region’s historic Russian master. Earlier that evening I had met one of the president’s closest advisers in a drinking den near my hotel. The place was full of bohemian young Georgians and westerners working for NGOs, and it did remind me of west Berlin in the 1980s—down to the pleasingly retro Bob Dylan and Beatles music. After many days of hearing about Georgia’s successful experiment with freedom from smart thirtysomething government ministers, or the failings of Saakashvili’s centralised, “guided” democracy from dowdier and older opposition figures, I still had a question that I had no proper answer to. It was one that I had hesitated to ask the president when I had met him earlier that day (see interview p50). I put it to his adviser instead. Why, when the Middle East is on fire and the west is distracted by its power slipping eastwards, should anyone care about Georgia? The adviser had a good answer. “A lot of people in the west think that the colour revolutions in Ukraine, Georgia and Kyrgyzstan have all failed or slipped back. But that is not true of Georgia—we remain absolutely part of the west.” And why does that matter? “In eastern Europe there was still some memory of pre-Soviet freedoms. Out here there was none. We are surrounded by Chechnya, Dagestan and Ingushetia in the Russian Federation, the Caucasian former Soviet republics of Armenia and Azerbaijan, and then the countries of central Asia. These are not places with a tradition of the rule of law or liberalism or the market economy. We have shown that these things can work in this unpromising region. As well as being an economic and energy hub, we are the place that the west can exert soft power in central Asia and even Iran.” He paused, and chuckled. “And that, by the way, makes us an existential threat to a Putin-style Russian way of doing things. Little Georgia is more of a threat to Russia than vice versa.” *****

Flying into Tbilisi’s modern airport and travelling, at night, into the charming, brightly-lit city centre, mostly unscarred by ugly Soviet-era architecture, it is possible to imagine you are in Scandinavia rather than the Caucasus, with Russian missiles 35 miles up the road and Grozny, the once blood-splattered capital of Chechnya, about as far away as Birmingham is from London. In the cold light of day Tbilisi, in which a quarter of the country’s population live, is of course nothing like Scandinavia. The crumbling facades on most buildings, the overmanned desks in the ministry lobbies, the pinched faces in the crowd, the persistent beggars, remind you that even in its affluent heart Georgia cannot so easily sweep away 70 years of Soviet rule. Before my arrival I remembered it as one of the more pleasant parts of the old Soviet Union, a place with a long history, Black Sea resorts, its own language and wine (though also the birthplace of Stalin and his feared secret police chief, Lavrentiy Beria). I was also dimly aware of a disastrous post-Soviet period during which it was wracked by conflict and economic collapse and then ruled by the ineffective Eduard Shevardnadze, Gorbachev’s foreign minister. (The writer Wendell Steavenson lived in Tbilisi in the mid-1990s, when there were only three or four hours of electricity a day, and wrote a fond memoir of that period, Stories I Stole.) Then in 2003 came the Rose revolution—the first of those US backed “colour” revolutions in former Soviet republics—when a young, liberal grouping within the Shevardnadze government took to the streets and grabbed power. It was a nationalist and a democratic and free-market revolution: Saakashvili and his supporters were like liberal Bolsheviks dragging Georgia out of its post-Soviet torpor and into the capitalist sunlight. They packed off the older generation into retirement. Then they did things such as sacking all 14,000 of the country’s traffic policemen on a single day to break a culture of petty corruption, before moving on to battle the serious gangsters (Georgians are big players in Russia’s mafia underworld). The economy roared ahead and the lights went back on. A flat tax was introduced and the taxation take increased from 11 per cent to 30 per cent of GDP. The state was withdrawn from most of economic life but strengthened in everyday existence; it became possible to trust officialdom. Georgia remains poorer than many of its neighbours: its per capita GDP of $4,500 is about the same as Sri Lanka. Yet for most people in the country and small towns this creation of effective government was an incomparable blessing, and one which provides Saakashvili’s United National Movement with a solid base of electoral support. Not everything went to plan. In 2007 a varied opposition movement—some wanting to turn the clock back, others wanting faster change—staged protests in Tbilisi. These were violently broken up and an opposition television channel was closed. This damaged the president’s reputation—making people wonder if he was a Caucasus strongman after all, albeit one who had mastered liberal rhetoric. In the 2008 presidential election Saakashvili, who had won 96 per cent of the vote in 2004, returned to earth with a majority of only 53 per cent. And then came the confrontation with Russia. The Russians had looked on with dismay after the Rose revolution, as Georgia marched out of its orbit with an aggressive pro-western swagger. In 2006 Moscow banned most of Georgia’s exports. Then, after a somewhat reckless Saakashvili went on the offensive, the Russians grabbed the chance to push the Georgians out of the two “autonomous regions” in the north of the country—Abkhazia and South Ossetia—in the five-day war of August 2008. The fact that the Russian flag is raised just 35 miles from Tbilisi, as I saw for myself on a trip to the new unofficial border with South Ossetia, is a blow to Georgian pride. But the reality, says Shorena Shaverdashvili, editor of the news magazine Liberali, is that two and a half years after the war “the Russians have shot all their bullets—there isn’t very much more they can do to us.” (Georgians claim that over 400 died in that war.) The dispute about Abkhazia and South Ossetia has been frozen and internationalised. Georgian officials like to appeal to the western conscience by stressing the Russian threat, but their heart isn’t in it, and it clashes with the other story they want to tell about what a stable place their country is to do business. As the Russians intended, the conflict blocked Nato membership for Georgia. Full EU membership is also “15 or 20 years in the future” says Tornike Gordadze, deputy minister of foreign affairs and a former Parisian academic—an assessment some would think optimistic. But so what? Georgia gets western support when it needs it, even when the west is trying to repair its relations with Russia. After the war Georgia got a £2.8bn loan from the US and Europe and, on the first anniversary of the war, Barack Obama telephoned Dmitry Medvedev to caution him about hostile Russian troop manoeuvres near the border. (The Georgian government, which named a highway after George W Bush, directs most of its disappointment with the west at Europe rather than the US, but Georgia may well conclude a free trade deal with the EU in the next few years.) ***** After the shock of the war in 2008, and a shrinking economy and disruptive (but better-handled) opposition demonstrations in 2009, the Georgian experiment appears to be back on track. Growth in 2010 is predicted to be around 6 per cent. Meanwhile, Saakashvili and his ministers beat their chests about how many delegations they receive from surrounding countries (even discreetly from Russia) to study their success against corruption and with electoral and tax reforms and so on. And the “regional hub” strategy of economic and cultural openness, which has extended beyond free trade to visa-free travel for countries in the neighbourhood (including Iran), is in its infancy. Perhaps it won’t be long before middle-class Iranians are taking holiday breaks in the smart hotels of Batumi on the Black Sea. Georgia is a laboratory. And it is impossible not to be impressed by some of the technicians: leading members of the often foreign-educated, English-speaking, youthful generation who seized power in 2003, having incubated their ideas in government or Tbilisi think tanks in the late 1990s. They are a different species from the older Soviet generation. Take the poised, well-dressed 32-year-old Eka Zguladze, a minister since 2007 in the crucial Interior Ministry. She describes in a matter-of-fact way the culture change in the police: “We were idealistic. My parents and grandparents didn’t think it was possible. We had to change a whole consensus, so the wife and kids of the policeman stopped seeing corruption as inevitable and came to despise it.” Or Giga Bokeria, 38, secretary of the National Security Council, a former student leader who, despite being a practising Orthodox Christian, once got beaten up for defending the religious freedom of Jehovah’s Witnesses. This young elite had studied the texts of economic and political liberalism and, unlike us blasé westerners, still believed in the power of ideas to transform society. The Georgian experiment has also sucked in foreign fellow travellers like Raphaël Glucksmann, son of André Glucksmann, the former French Marxist who publicly abandoned the old religion in the 1980s. You can see the attraction. This is a place where you can get things done, whether it is big experiments like the flat tax or smaller things like recruiting 10,000 teachers of English from abroad (so that English rather than Russian, becomes Georgia’s second language) and giving all schoolchildren a free laptop. But the Tbilisi elite are an intriguing mix of idealism and cynicism. They know that democratic politics is, at times, a low game and that their president is a brilliant player. And therein lies Georgia’s problem. Despite its achievements, official opinion in the west—governments, NGOs and so on—remains rather sniffy about it. Back in London, I bumped into a senior figure in Britain’s security services; when I told him where I had been he said dismissively, “so you got the full propaganda blast did you?” Yes, I did. And yes, they do put a lot of energy into PR (see the recent adverts in the Economist and FT highlighting Georgia’s success in an index for ease of doing business). And yes, the experiment has many flaws. Two in particular. First, it is only half a western democracy; it does not yet have a proper opposition or a fully independent judiciary or media. Second, its economy is running on too much Friedman-ite idealism and suffers chronic underemployment and poverty. On Georgia’s democratic deficit there is a wide consensus that includes the country’s divided opposition, foreign observers, and even government ministers. When I described the country to Saakashvili as “a benign one-party state” he didn’t protest but countered with how they are grafting BBC-style impartiality onto the main public television channel. He talked about the appointment of judges for life and new jury trials. “The country is run by five people, and because of the electoral dominance of the ruling party the parliament is a rubber stamp,” says journalist Shorena Shaverdashvili. “The trouble is that all the well-educated progressive people got sucked into the government or the pro-government media and think tanks.” The point where the three weaknesses—opposition, judiciary and media—intersect is the tax police. Opposition parties and media are weak partly because nobody with money dares to support them, knowing that if they did they could receive a visit from the tax police who would threaten them with prosecution. And in a country with a very low acquittal rate that would mean a period in jail or the payment of a large fine to the government. Georgia is setting itself up as a model, and asking to be judged by western standards, so such criticisms are perfectly valid—even if one should remember that the country has only been fully independent for 20 years, has 20 per cent of its land occupied by Russia, and has never had a constitutional transfer of power (and in a such a small country a determined crowd of 150,000 is probably enough to do it unconstitutionally). Levan Ramishvili, head of the Liberty Institute, the think tank that the president once worked for, has an unusual defence of the status quo: “Party-based political pluralism only exists in urbanised, educated western societies and we are not yet there. You should compare us with Latin America.” Ramishvili is the radical liberal conscience of the Rose revolution but worries more about deviations from free-market orthodoxy than political failings, in particular the populist temptation to overpromise and allow public spending to rise too fast. But there is a more basic economic problem: the country doesn’t produce enough. Moreover inflation is over 10 per cent and the public finances are problematic. “There is a lot of free-market wishful thinking,” said one ambassador. “By unilaterally opening its economic borders Georgia has allowed Turkey to dump its agricultural produce and its building materials. Exports have not recovered from the closure of the Russian market and despite the claim that this has forced them to diversify markets and improve their wine, it’s still pretty awful. The only places that work are Tbilisi, Batumi and the port of Poti.” ***** The “true believers” reject the idea that an economy can be too open. But they need to attract more inward investment and raise their exports sharply to prove that dictum correct. There is potential in financial services, hydropower and tourism, but it won’t create many jobs for the 30 per cent of people who don’t have proper ones. The government now promises to focus on agriculture but only 1 per cent of the budget is dedicated to it and Bakur Kvezereli, the minister, is an inexperienced 27 year old. There is a natural slot for an opposition here: slightly left of centre, pressing on social and countryside issues, and a bit less anti-Russian. There is a Christian Democratic party that occupies roughly this space, although it has no credible leader. Until a decent opposition leader emerges Georgia will be run by Saakashvili’s kitchen cabinet, or just by Saakashvili himself. A recent constitutional shake-up is switching Georgia from a presidential to a parliamentary system in which the prime minister is the most powerful figure. The talk of political Tbilisi is whether Saakashvili will run for PM when his second and final term as president ends in 2013, mimicking the move by Vladimir Putin, Russia’s former president and now prime minister. Will he or won’t he? I asked everyone I met and most guessed he would stand. But that would be bad news for his international reputation, and for Georgia’s struggle to embrace a less controlled form of democracy. I think Saakashvili understands this, and does not want his legacy to be that he “did a Putin.” While I was in Tbilisi a new subsidiary of Georgian public television was launched, run by Robert Parsons, a British journalist. Called PIK, it aims to broadcast (in Russian) to neighbouring countries—Chechnya, Dagestan, Ingushetia and so on—covering what Parsons described as the northern Caucasus “intifada.” PIK is a sophisticated agent of Georgian soft power, a vast improvement on the Russian hard power that the Caucasus knows only too well. But it also reflects Georgia in all its messy reality—the highlight of the launch night was a two-hour interview with none other than Mikheil Saakashvili.

Outside Mikheil Saakashvili’s modern, glass-topped presidential palace, with spectacular views down over the hills of Tbilisi, there is a steel sculpture of three moving shapes representing the executive, the legislature and the judiciary. The sculptor is Gabriela von Habsburg, granddaughter of the last Emperor of Austria, and currently Georgia’s ambassador to Germany. The three shapes are of equal size. If the sculpture was true to life the executive would be several times larger than the other two. But the shapes and their creator tell you a lot about contemporary Georgia. This is a land with an idealistic attachment to western liberal values (even if sometimes observed more in the breach) and a president capable of charming not only his own people but attracting foreigners, such as the glamorous Gabriela, to the cause. The antechamber to his office is covered in photos of Saakashvili with world leaders; there are framed cuttings too. One of them describes him as a “born showman.” He clearly relishes his rogueish image and has a western ease and openness that is strange to this part of the world. Saakashvili—or Misha, as everyone calls him—is the son of Tbilisi intellectuals. He speaks good, accented English, thanks in part to a period at law school in New York. A large, lively man of 43, he sat behind a vast desk covered in the detritus of high office when I met him. When I ask about his legacy—he has run the country since the pro-western revolution of 2003 and is now halfway through his second and final term as president—he says he prefers to look ahead to his remaining years in office. He reminds me that “our very survival is still not self-evident… the existential issue is still there when your largest neighbour [Russia] does not recognise your borders or your government.” Then he launches into a list of what he wants to do next. Fully aware that the main western criticism of Georgia is that power is too concentrated on him, he waves around architects’ plans of the new parliament building being erected in Kutaisi, Georgia’s second largest city, which is being rebuilt to house Tbilisi’s political class. “The whole political psychology of the country will change,” he says. “This decentralisation is what the Rose revolution was all about, it’s not just about escaping the old Soviet elite but the centuries-old elite that has run things. We want an open, democratic system for all our nearly 5m people.” The list continues. A reform of education. A revolution in the struggling agricultural sector, led by a few hundred South African Boers due in Georgia next year to improve farming techniques. Fast trains and better highways. “And after we’ve done all that, things might become a bit boring here,” he smiles, mocking his own over-ambition. He returns to Russia’s presence in occupied Abkhazia and South Ossetia and then, contradicting this implied vulnerability, launches into a discourse on Georgia’s soft power. “We are a clear threat to Russia’s ambition to control all central Asian energy routes to Europe, but something that is not detected by outsiders is the soft power of Georgia: we offer an alternative pole of attraction. The president of Armenia always quotes our reforms, the Ukrainian government has sent ministers to study our police reform, our tax reform, our anti-corruption measures, the president of Kyrgyzstan had a meeting recently with Obama and half of it was about how she wants to copy our reforms. After the war Russia wanted to isolate and strangle us, but it hasn’t happened.” Indeed some rich Russians are even warming towards Georgia. He fishes around for a copy of Russian GQ magazine and holds it up to reveal a picture of a half-naked woman entwined by a snake. “Russian GQ described us like we used to imagine Reagan’s America—paradise!—that must have annoyed Putin.” We touch on Georgia’s blocked path to Nato, despite sending troops to Iraq and Afghanistan. Saakashvili maintains it will happen one day but says: “we are the best pupil in the class but they won’t allow us to go on to the next grade.” Negotiations with the EU over trade are more fruitful although full membership is a distant dream, with the EU’s growth now all but frozen. I ask about the conflict between the idea of Georgia as a free-market haven like Dubai and its desire to join the “official” western economy which requires adherence to all sorts of regulations from labour codes to food safety. He admits there is a tension and talks of Estonia—a liberal economy within the EU—as the model. I am told later by one of his aides that the mention of Estonia represents the victory of pragmatists over free market ideologues. When I put the criticism to him that Georgia is a benign one-party state without a proper opposition or independent judiciary, he seems to half agree, citing the “political suicide” of the opposition two years ago. He claims that the opposition is now getting its act together and hitting the government on social issues (there is only a very basic welfare state) and could realistically get more than half of the vote. He also talks about a recent surge of confidence in the courts. So, finally, that big question—is he going to stand “Putin-style” as prime minister in 2013 as a recent change to the constitution allows? He first goes on a detour about how happy he is that all big institutions in Georgia are now more popular than him—and contrasts this with how “uninstitutionalised” and “personal” power is in Putin’s Russia. He will not be drawn on the question itself, although he does say that he doesn’t want to be a “lame duck” president. I thought his reticence implies that he has decided not to stand. If so, it will be a relief to many of Georgia’s western well-wishers. Could he go off to do a big international job? One Tbilisi insider laughed at the idea when I suggested it, saying that Saakashvili is too impatient to sit in committees all day. I suggest to the president that he should put himself in charge of the project of decentralising politics and perhaps come back as prime minister a few years later. “I don’t believe in comebacks,” he says and grins his big grin.