Has Vladimir Putin lost touch with reality? Once widely viewed as a cunning, if ruthless, but ultimately rational actor, the Russian president is now isolated and increasingly paranoid, having launched a war in Ukraine that has alarmed even some of his closest advisers, says Catherine Belton, a former Moscow-based correspondent for the Financial Times, now with Reuters and the author of the widely praised book “Putin’s People: How the KGB Took Back Russia and Then Took on the West.”
In an interview with Yahoo News’s “Skullduggery” podcast, hours before Putin placed Russian nuclear forces on high alert, Belton explains why the battle for Ukraine could be the Russian president’s waterloo.
What follows is an edited transcript of Belton’s conversation with Yahoo News chief investigative correspondent Michael Isikoff, Yahoo News editor in chief Daniel Klaidman, and Victoria Bassetti, a fellow at the Brennan Center for Justice.
Catherine Belton: I’m afraid it’s not, clearly not, having too much impact on Putin’s own calculus. And I guess the question is really: To what degree is he now just acting all by himself? Because I actually can’t imagine for an instance that his decision to launch a full-scale invasion of Ukraine was supported by a majority of his own top officials. And you could see that on their faces when he held that Security Council meeting on Monday. You could see the fear in their eyes and that, really, they didn’t want to be there. They all looked deeply uncomfortable.
And I think for many in Moscow, Putin’s actions this week have come as a great shock. I think many were preparing for him to maybe, yes, recognize the independence of Donetsk and Luhansk because already, since 2015, de facto they’ve been independent anyway. They were held by separatists backed by the Kremlin, and this was just making a de facto situation de jure.
And it would have allowed Putin to kind of walk out. He’s taken yet another little slice of Ukraine. He could continue to perhaps menace from the borders and threaten [Ukrainian president Volodymyr] Zelensky in an attempt to gain concessions from Zelensky and maybe from NATO on missile shields and so on. No one expected him to go this far, and you can see that in the reaction of the Russian stock market, for instance. … It lost half its value immediately after the invasion.
Daniel Klaidman: So the fact that the people around him are so surprised suggests that Putin has changed in some fundamental way. That there’s been some shift here. And people talk about him being increasingly isolated. Why do you think it happened?
Belton: I wish I knew the answer to it, and it’s the answer that … everyone’s trying to scrabble around and guess at, including quite high-placed officials in Moscow who really don’t understand what’s changed. But we can only presume it’s the last two years of the pandemic, where he has been increasingly isolated. And, as you say, he has become consumed by history and his place as the restorer of the Russian lands.
We always knew that he placed a very special emphasis on kind of restoring Russia’s greatness and restoring its imperial past. We also know that, even from 1992, when he gave his first-ever interview as the deputy mayor of Saint Petersburg, that even then he was suggesting that Ukraine wasn’t a real country. Even then he was blaming the Bolshevik revolutionaries, as he did in his speech on Monday, for creating an artificial republic. … He doesn’t believe that Ukraine should exist. He believes it should be part of the Russian empire.
But we’ve seen him always before, no matter what he’s done … we’ve always seen him act, perhaps wrongly and terribly, but always with a degree of cool rationality. … And it seems [that] has changed over the last two years. He’s lost touch with reality. I mean, it really seems that he thought maybe the Ukrainians would just back down. Maybe he thought Zelensky was going to do the same. But it certainly seems he didn’t expect such resistance, and he didn’t expect, I think, such a strong response from the Western world, because Russia’s economy is now going to be devastated and it’s getting cut off from all the cultural ties. I mean, so many Russians are completely devastated by what’s happened.
Victoria Bassetti: Do you think Ukraine is the end of his kind of, let’s call it, descent into madness?
Belton: I guess we’ve got to hope so. And the signs are hopeful. I mean, the stronger resistance that Ukraine can put up, the stronger the resistance from the West, will hopefully mean that this is the end, that it is his waterloo, and it will lead to his toppling. We have to see how long can President Zelensky withstand the Russian forces. We have to see whether the U.S. and the rest of the Western allies will now escalate their response. Because at the moment, I think we’re only seeing the beginning of the impact of the sanctions that were launched earlier this week. So the sanctions against [Moscow-run financial services company] Sberbank, against [Russian state bank] VTB, barring them from conducting any dollar transactions, they’re pretty tough. We’re already seeing signs of a run on the banks. But Russia’s Central Bank has clearly made some quite strong interventions in the market to prop up the ruble and to keep things stable for now. But for quite how long it can continue to do so is another question.
I think if the U.S., as is being suggested, goes ahead and sanctions Russia’s Central Bank, that’s going to wipe out a huge chunk of Russia’s hard currency reserves, and is potentially devastating. And you would have to hope that that would be a very, very strong deterrent against Putin ever considering going any further than what he has. But I’ve just been speaking to one Moscow businessman who’s pretty well connected, and he says that’s not possible. [Putin] can’t back out now. He’s crossed the Rubicon. He would completely lose face.
Bassetti: Putin still has cards in his hand, especially regarding some of the economic sanctions. He has the ability to counter-retaliate against the Western world. What are the odds that he’s going to kind of engage in those strongly disruptive retaliatory actions regarding energy and the other mineral reserves that Russia and Ukraine have the power over?
Belton: I think, at the moment, Putin is scrambling a little bit. He hasn’t decided himself how he’s going to react because, again, I think he’s facing much stiffer resistance from Ukraine than he expected and much stronger resistance from the West as well. So I think he wasn’t expecting to face so much trouble. I think he didn’t think that this was going to provoke such a strong response. I think that he had a kind of plan, perhaps that they might sort of be able to muddle through the Western sanctions. They’ve been creating their own alternative to SWIFT [Society for Worldwide Interbank Financial Telecommunication]. For instance, Russia had created its own system, and I was told that in response to the sanctioning, the barring of the biggest state banks, [they] weren’t conducting any dollar transactions. The Russian Central Bank had been working on developing a program for correspondent accounts with the Chinese. But that appears not to be working because already there was news yesterday that some very big Chinese banks were refusing to carry out Russian dollar transactions, Russian dollar contracts, and they don’t have the support from the Chinese that they expected.
So I think Putin is, you know, he’s finding his way. We don’t know what he’s going to do. Unfortunately I’m not sure any of his closest officials are able to put up any resistance because we all, again, we all saw how fearful they were of him during that Security Council meeting, and I think they just have to blindly follow orders. … But yes, as you say, he does have some tricks up his sleeve. He could, for instance, sort of stop exports of titanium to the West, and Boeing is a big importer of Russian titanium. It needs it to build its aircraft. That could be one thing that he could do. I really doubt that he would cut off oil and gas supplies into Europe and the rest of the West because that would be kind of like cutting off his nose to spite his face.